I've posted quite a number of tips that might help with this over
at https://bugs.launchpad.net/ubuntu/+source/modemmanager/+bug/482971.
I've managed to get pppd going (and confirmed operation via ping via
both DNS and direct IP addresses) ... but for me, I'm still watching my
pppd fight with my ISP over what should be a static IP address.  My set
up only works with Ubuntu 9.10 via a dynamic (pppd negotiated) IP
address (... and that won't do for me).  To recap:

     1.  modem-manager package must be completely removed (and system 
rebooted).  Modem manager squats on devices that it fails to recognize on ADSL 
modems (e.g. regular USB Modems).  
     2.  Neither GNOME-PPP nor wvdial will work (but 'pon' and 'poff' and 
direct 'pppd' invocations *do* work).  With gnome-ppp and/or wvdial, I get 
errors about 'Serial Link is not 8 bit clean' (see 
http://ppp.samba.org/ppp/FAQ.html).
     3.  /usr/sbin/pppd is group 'dip' ... so be sure to make your user account 
a member of group 'dip'
     4.  Make sure that neither gnome-ppp/wvdial nor network manager have put 
something like auto ppp0 into /etc/network/interfaces file.  If so, comment 
that out (by hand).
     5.  Make /etc/ppp/pap-secrets and /etc/ppp/chap-secrets at least readable 
by group 'dip'
     6.  If using the excellent 'wvdialconf' command, grab the local 
.wvdial.conf file and hand integrated it into /etc/wvdial.conf.  For the most 
part, one can just overwrite the /etc/wvdial.conf file that comes with Ubuntu 
9.10 (by default).  

Good luck, Steffen.

-- 
gnome-ppp fails under 9.10, works under 9.04
https://bugs.launchpad.net/bugs/469881
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