Like it says, use instrfind to determine whether Matlab thinks COM1 is already in use.
What model of computer and which OS are you using? Historically it was common for COM1 and COM3 not to be simultaneously available as they share the same IRQ. It became common for a time for manufacturers to omit COM1 (especially on laptops) or to use COM1 internally for some other device rather than a user-accessible serial port. Is your serial port definitely labeled as being COM1 or is that just what you are expecting it to be? What does the Windows Device Manager say about the COM ports?
Oh I remember -- it become common for COM1 to be used by a built-in modem, and it was the fad for a time to share a single physical connector, with the device being named COM1 when it was being used as a modem and named COM3 when it was being used as a serial port.
