Hello.
This error means You have not connected the device correctly. To connect GT-N7000 you have to perform the following steps:
1. Disconnect USB cable from phone.
2. Go to Menu->Settings->Applications->Development.
3. Turn on "USB Debugging" option.
4. When message is appear press "Yes".
5. Go to dial window.
6. Enter "*#7284#" number.
7. Set "USB" radio button to "PDA" value.
8. Close window.
9. Go to dial window.
10. Enter "*#9090#" number.
11. Set "Diag config" to "USB" value.
12. Restart phone.
13. Press "Read Info" in software.