New modem causing playback problems, I think.

I installed a D-Link DSL-502T modem two days ago and it seems to be working fine. Except... when I'm playing any music or video file it disrupts the output. I'm not talking only about watching or listening online. It affects files on the computer as well.
Last night the system got so slow and buggy I thought I had a virus or a trojan, even though I keep all my protections updated. I switched off, when I switched on again this morning all seemed OK again. But the disruptions began again. Very small and almost unnoticeable at first but gradually getting worse.
I tried playing the same songs with the modem turned off. There was no problem.
Any suggestions?

My computer is an Acer 3600GT running Win XP Home.

 

One detail I forgot to include.
I'm blaming the modem for the problem because I've noticed that the disruption coincides with the flickering of the USB light on the modem front panel.