I have the latest graphic drivers and DirectX.
I don't have any problems with other games, just ArmaIII.
I tried verifying integrity of game cache, and I tried with remove/re-install game from Steam, but same thing is happening. Game just doesn't want to start.
I had even trouble to have game to generate crash report.
Batlleaye also reported 'failed to download' on some first tries, but it stopped.
I must add: when I purchased the game, IT WAS WORKING. I have played it for few hours then had a very long pause without playing it again (was waiting for my friend to buy it too so we can play together).