I also got this today running bzr.dev (1.6b4)

--
$ bzr branch lp:bzr-search/trunk search2
bzr: ERROR: socket.error: (110, 'Connection timed out')

Traceback (most recent call last):
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/commands.py", line 857, in run_bzr_catch_errors
    return run_bzr(argv)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/commands.py", line 797, in run_bzr
    ret = run(*run_argv)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/commands.py", line 499, in run_argv_aliases
    return self.run(**all_cmd_args)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/builtins.py", line 826, in run
    from_location)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/bzrdir.py", line 885, in open_tree_or_branch
    bzrdir = klass.open(location)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/bzrdir.py", line 762, in open
    t = get_transport(base, possible_transports=possible_transports)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/lazy_import.py", line 125, in __call__
    return obj(*args, **kwargs)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/transport/__init__.py", line 1527, in get_transport
    base = directories.dereference(base)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/directory_service.py", line 53, in dereference
    return service().look_up(name, url)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/plugins/launchpad/lp_directory.py", line 60, in look_up
    return self._resolve(url)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/plugins/launchpad/lp_directory.py", line 76, in _resolve
    result = resolve.submit(service)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/plugins/launchpad/lp_registration.py", line 182, in submit
    self._authenticated)
  File "/stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/plugins/launchpad/lp_registration.py", line 147, in send_request
    result = method(*method_params)
  File "/usr/lib/python2.5/xmlrpclib.py", line 1147, in __call__
    return self.__send(self.__name, args)
  File "/usr/lib/python2.5/xmlrpclib.py", line 1437, in __request
    verbose=self.__verbose
  File "/usr/lib/python2.5/xmlrpclib.py", line 1183, in request
    self.send_content(h, request_body)
  File "/usr/lib/python2.5/xmlrpclib.py", line 1297, in send_content
    connection.endheaders()
  File "/usr/lib/python2.5/httplib.py", line 860, in endheaders
    self._send_output()
  File "/usr/lib/python2.5/httplib.py", line 732, in _send_output
    self.send(msg)
  File "/usr/lib/python2.5/httplib.py", line 699, in send
    self.connect()
  File "/usr/lib/python2.5/httplib.py", line 1134, in connect
    sock.connect((self.host, self.port))
  File "<string>", line 1, in connect
error: (110, 'Connection timed out')

bzr 1.6b4 on python 2.5.2 (linux2)
arguments: ['/usr/local/bin/bzr', 'branch', 'lp:bzr-search/trunk', 'search2']
encoding: 'UTF-8', fsenc: 'UTF-8', lang: 'en_ZA.UTF-8'
plugins:
  authors              /home/amanica/.bazaar/plugins/authors [unknown]
  bisect               /home/amanica/.bazaar/plugins/bisect [1.1.0pre0]
  bookmarks            /home/amanica/.bazaar/plugins/bookmarks [unknown]
  bzr_push_and_update  /home/amanica/.bazaar/plugins/bzr_push_and_update [unknown]
  bzrtools             /home/amanica/.bazaar/plugins/bzrtools [1.6.0]
  difftools            /home/amanica/.bazaar/plugins/difftools [unknown]
  docdiff              /home/amanica/.bazaar/plugins/docdiff [0.9.0]
  email                /home/amanica/.bazaar/plugins/email [unknown]
  gtk                  /home/amanica/.bazaar/plugins/gtk [0.96.0dev1]
  launchpad            /stuph/projects/bzr/bzr.repo/bzr.work/bzrlib/plugins/launchpad [unknown]
  lessdiff             /home/amanica/.bazaar/plugins/lessdiff [unknown]
  lesslog              /home/amanica/.bazaar/plugins/lesslog [unknown]
  merge_into           /home/amanica/.bazaar/plugins/merge_into [unknown]
  multiparent          /usr/lib/python2.5/site-packages/bzrlib/plugins/multiparent.py [unknown]
  qbzr                 /home/amanica/.bazaar/plugins/qbzr [0.8.0dev0]
  rebase               /home/amanica/.bazaar/plugins/rebase [0.4.0dev0]
  search               /home/amanica/.bazaar/plugins/search [1.7.0dev0]
  stats                /home/amanica/.bazaar/plugins/stats [unknown]
  svn                  /home/amanica/.bazaar/plugins/svn [0.4.11dev0]
  update_mirrors       /home/amanica/.bazaar/plugins/update_mirrors [unknown]
  xmloutput            /home/amanica/.bazaar/plugins/xmloutput [0.4.4]
*** Bazaar has encountered an internal error.
    Please report a bug at https://bugs.launchpad.net/bzr/+filebug
    including this traceback, and a description of what you
    were doing when the error occurred.