When Steam is preparing SFM files to install, it says that it has a Connection Timeout, theres nothing wrong with my connection, can anybody help with this please?
Tried restarting Steam?
It's not much help OP, but a friend of mine has also been getting the same problem so you're not alone (came on here to ask about the same problem for his sake, actually). He's tried restarting steam and that apperantly hasen't worked.
i restarted steam a couple of times, rebooted, and still it appears.
Delete ClientRegistry.blob in your Steam folder and restart Steam, it will take a little longer to start it, but it fixes almost all Steam problems.
Change the download region to somewhere in usa.
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