Technically, iTunes 17 is very similar to error 3194 even though the latter happens more often than the former. According to Apple's support documents, Error 17 comes up when there is a connectivity issue.
Fixing iTunes error 17 has a lot of similarities to fixing error 3194. But we'll be taking an approach that aims to stick to the default position in iTunes, hosts file etc. to clear out the error.
iTunes error 17 should usually show up when you are trying to upgrade to a new iOS firmware version. For instance, at the moment, people trying to iOS 7.1 from 7.0.x might face the issue. And since we have a diversified demographic (various devices, jailbreak statuses, previous alteration of the hosts file etc.), you might have to try a variety of things before the error gets fixed.
Check your network
Since we're talking about connectivity issues, most of the time the issue lies with iTunes trying to – unsuccessfully – connect and download the required IPSW file from Apple's server. This doesn't necessarily mean your network is down or buggy but checking it helps.
If you are on Wi-fi, make sure it's stable. If you can switch to LAN till iTunes downloads the file, do it for a stable network. But if you are sure your network is working just fine, jump to the next tip.
Firewall, Administrator Settings
An anti-virus like AVG Scanner can put up security blankets on the way your computer connects to the internet. This might be in the form of a firewall that lets you access your email and browser websites but prevent iTunes from contacting Apple's servers securely to access the required files.
Try turning off the anti-virus and test the update process.
Also, check the individual firewall settings of the Mac/PC you are on. Make sure there are no restrictions.
Editing the “hosts” file
Did you happen to edit the hosts file sometime back? Doesn't matter if you remember or not. Let's go check it.
On Mac: Open the /etc/ folder and look for the hosts file.
On Windows: Navigate to C:/Windows/System32/drivers/etc/ and open the hosts file.
Once you have the hosts file open, scroll to the bottom and look for any line that has gs.apple.com (or any other modification of apple.com). If there is, make a backup copy of this hosts file (place it somewhere easily accessible, like the desktop) and then delete the line that contains the apple.com reference. Just the line.
Restart iTunes and try to update/upgrade.
If you've used a fix that employs TinyUmbrella to get around, say, error 3194, this might have put some line in the hosts file which might cause connectivity issues.
Update iTunes software / OTA Update
This one is a very common suggestion. Make sure you use the latest version of iTunes by updating it. Also, try to update directly from the iPhone/iPad through the OTA (over the air) update. Instead of connecting your iPhone to iTunes, go to Settings → General → Software Update and update the firmware.
For this again, you need to be on a stable Wi-fi network.
Jailbreak / Non-jailbreak
If you use a jailbroken iPhone and want to upgrade to iOS 7.1, you can't just update/upgrade. You have to restore your device as new via iTunes and then use a backup to restore data. Yes, it's a longer process but that's what we pay for jailbreaking. No big deal though.
It's very rare that you run into an error 17 when you upgrade a jailbroken iPhone to iOS 7.1 but if you do, restore as new.