Check also if the servers.def file is corrupt or 0KB (C:\Program Files\Alwil Software\Avast4\Setup\servers.def). You can try and download the servers.def file,
http://files.avast.com/iavs4x/servers.def and replace the one in the avast setup folder.
If this fails, basically, check:
1) If your subscription allows the update right now (i.e., if it is not expired).
2) If your firewall settings and allow
avast.setup to connect. If you're not sure, just turn off your firewall (to be sure the update failure is not due to it). Maybe you should 'remove' avast.setup entry, try to update, receiving a new alert from the firewall, allowing it and checking it to remember.
3) Check your proxy settings into avast!:
Left click the avast icon > Settings
Update (Basic) > Details > Proxy
Make sure your browser is not set to "Work Offline" (this option is generally in the File menu). If it doesn't help, try switching the proxy settings from "Auto-detect" to "No proxy" (I'm assuming you're not connecting to the Internet via proxy).
