Have you tried littering the above code with tracing commands to see what is being received from the box you're connecting to? Sometimes you need to initiate a telnet connection with a "\n" just to kick it into life and send a prompt.

e.g.

my ( $r, $resp );

# kick the connection into life with a carriage return
print $sock "\n";

# read in from the connection
while (sysread($sock, $r, 1024) >= 1) {
    print( STDERR 
           "At " . scalar(localtime(time())) 
           . " received '$r'\n" );

    $resp .= $r;
    $resp =~ /prompt>/ and last;
}

# print username to socket
print( STDERR "Sending username..\n" );
print $sock "$username\n";

# debugging loop just to see what we're getting
while (sysread($sock, $r, 1024) >= 1) {
    print( STDERR 
           "At " . scalar(localtime(time())) 
           . " received '$r'\n" );

    $resp .= $r;
}
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Note you can use the strace command as the root user on a linux box to attach tracing to your script. It will give you an idea of what text is coming and going from your socket. Very useful for debugging.