Adding new e-mail account - does not recognise passwords

Im trying to add my @live.com e-mail to my account in settings but it keeps saying that my password is incorrect. I've tried to do it through the hotmail tab and other but neither works. I have an iphone 4. Please help.

Go to the support website for Hotmail.  You may have enabled Two-Step Verification.  If so, then you'll need to have a separate password for mobile device usage.
Also, Microsoft has been having issues on and off with mobile device mail for the past few days.

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