Oh, the nostalgia!
I loved this game when I was younger. I just recently saw it and downloaded it for nostalgic purposes, only to realize the game is dead. This means that the game has been abandoned by the developer and/or is not played by anyone often anymore. The developers having abandoned the game have most likely shutdown the multiplayer servers, as they cost money to run and the developers didnt want to invest in a dead game. As a result of shutting down the servers, any online play is completely impossible. Hence, the online arena doesnt work. Hope that cleared things up.
BTW, dont get me wrong. I would LOVE IT if this game was revisited by the developers. I just dont think it will be, considering how long its been. Otherwise, this is an awesome game. Thanks for making this game a part of my childhood and I hope you guys get back to it.
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TinyLegends™ Heroes, v1.4.6