I think I found a solution at macsonly.com
Fixes for Apple Modem Disconnect Issue: Some of Apple's computers, if not all by now, use a software internal modem which has a severe disconnect issue with the Apple Internal 56K Modem (v.90) script at least since Mac OS X 10.2.4, if not earlier. The issue is that the modem unexpectedly hangs up almost immediately after making what appears to be a solid connection. We have had that problem with our PowerBook G4 800 since we got it last June and we still have it with Mac OS X 10.2.5 which once again installed duplicate sets of modem scripts, the source of our problem.
One workaround that has worked for us is to select the Apple Internal 56K Modem (v.34) script instead of the v.90 script. Doing this reduces the maximum connection speed to 33.6K but that is of no concern in many places where only a 24-33.6K connection can be made anyway--many motel rooms.
We have another solution that works for us and it retains the 56K (actually 53K) potential connection speed. We found this solution on a forum/list somewhere last year. First note that there are two Modem Scripts folders, one in in the root Library folder and another in the System->Library folder. The latter only has the three Apple Internal 56K Modem scripts for v.34, v.90 and v.92. The former has many modem scripts, including the very same three Apple Internal 56K Modem scripts for v.34, v.90 and v.92. The solution that works for us is:
1. Make another folder at the drive's root level (we named it "ExtraModemScripts"),
2. Move the three scripts from the Library->Modem Scripts folder (not the System->Library->Mdeom Scripts folder) to the new folder,
3. Reboot,
4. Reselect the Apple Internal 56K Modem (v.90) script in the System Preferences Networking preference panel under the Modem tab and click the "Apply" button. If the (v.90) is already selected, then select another, click "Apply", reselect it and hit "Apply".
Try it, it worked for us on every Mac OS X update, including 10.2.5. The just-released 10.2.6 does not install new modem scripts.