[X-Newbies] Modem problems

[Gen Hadlow Mac Impact Dbn]

I'm setting up a G5 iMac 20" on 10.3.9 and having problems with the modem.
It detects dial tone - but that tone wont go away so that the modem should
start to dial. It tries to, on top of the dial tone so to speak.
That is the dial tone should stop and start to dial the phone number for the
ISP. But its not doing that. Just keeps going with the dial tone and other
weird noises.
I have tried various settings in the Network preference e.g. wait for dial
tone before dialling - on and off and it makes no difference.
Have tested the line with an iBook and there is no problem dialling out.

Any help would greatly be appreciated.