trying to install newspad, need help

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   i've uploaded the newspad folder and edited the 'database_connection.asp' file  but when i run the SQL server setup tool it comes up with the following error : 

Error Connecting to database on SQL Server

Check the following is set up and correct:- 

SQL Server User Name
SQL Server Password
Name of the SQL Server
Database name set up by you on the server
Empty Database set up by you on the SQL Server

Check also that you have entered the correct details in the file 'database_connection.asp' found in the 'database' directory.

Detailed Error Message:
[DBNETLIB][ConnectionOpen (Connect()).]SQL Server does not exist or access denied.

as far as i know the only thing i may have done wrong is the SQL servername when editing the 'database_connection.asp' file , i put in an IP address but to be honest i wasn't sure if that was correct or whether that was what i should be putting in . 

PLEASE HELP ! 