I was having the same problem (iPhoto reported "no network connection"). For me the problem turned out to be the firewall settings.
1. Go to Apple Menu>System Preferences.
2. Click "Security & Privacy".
3. Click the "Firewall" tab.
4. In order to make changes here, you may have to click the lock in the lower left corner and authenticate using the user name and password for your computer.
5. Then either turn off the firewall completely by clicking the "Stop" button or:
6. Click the "Advanced" button in the lower right.
7. Click the "+" button.
8. Select iPhoto and click "Add".
9. In the pop-up menu next to iPhoto make sure that "Allow incoming connections" is selected.
10. Click "OK".
11. Quit System Preferences.
12. Quit and relaunch iPhoto.
Problem solved.