Last week I spent few hours to figure out why Samsung Galaxy S2 was not connecting to Samsung Kies through USB cable. I could browse phone contents using Windows Explorer, transfer files, music and photos, even I could use Kies Air but Kies on my computer kept on ignoring the phone. It always displayed connecting but never got connected.
To resolve the connection problem several times I used the connection troubleshooter which comes with Kies, reinstalled Kies, updated Kies, restarted phone and computer but had no success. Then suddenly I figured this was happening because the phone is in wrong connection mode. By some application or setting the USB connection mode was set to Camera (PTP). Because of this Kies could not connect with the phone. To correct the connection problem simply I had to change the connection mode to Media Device (MTP).
This can be done by accessing the notification area.
Select Media device (MTP) to correctly connect to Kies.
Arjuna's space 
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Thanks guy, this is working great when you’re phone is stuck on Connecting …
What is notification area?
How do I get to the USB computer connection page?
I am running ICS that gives different screens to those shown
Thanks for commenting, sorry about the very late reply, I am now not checking comments that frequently because of hundreds of spam comments I am getting daily. just thought to reply since it might help some one.
Notification area is the screen you get when you swipe down from top of your screen. Also you have to do this when the cable is connected.
Thank you very much for this information. The Samsung Tech was clueless. We thought the problem was with the PC, but, as you discovered, it was the Samsung that needed to be changed.