that it would construct an inter-regional corporate network using Internet Protocol Virtual
Private Network (IP VPN) technology for Euroset, one of Russia’s largest networks of
communications retail stores.
Telecom’s digital backbone network. According to Igor Penkin, manager of the project at
Euroset, the choice of Golden Telecom as a contractor was based on the following factors:up-to-date equipment ensuring a high quality of service.
One of the main components of the project is Euroset's multi-service node (MSN), which
ensures the operating logic, control, protection and functions forming the basis of Euroset’s
regional corporate network. The MSNs are connected to Golden Telecom's networks using
Gigabit Ethernet technology, on the basis of the MEN (Metropolitan Ethernet Network), a large
overlay network built in Moscow.
For inter-city channels, Golden Telecom provides an IP universal transport medium using
the Multi-Protocol Label Switching (MPLS) technology. This approach to the IP VPN allows a
high quality of service in the use of various video, voice and data applications. In regional cities,
Golden Telecom provides local communication channels (last mile), establishes gateways to city
telephone nodes and provides numbering capacity on regional telephone networks.
Euroset has installed its node equipment in Golden Telecom’s regional hosting centers.
The node equipment connects to local communication channels and allows local regional
networks to be connected to Golden Telecom’s backbone network of. In addition to this, Euroset
independently installs its own routing equipment and controls and operates this equipment.
Nodes have already been connected and the construction of the network is under way in
Nizhny Novgorod, Voronezh, Samara, Ekaterinburg, Volgograd, Krasnodar, Penza, Orel, Perm,
Chelyabinsk, Murmansk, Kazan and Yaroslavl. A total of 40 regions of Russia are to be covered
by the project.
"Golden Telecom began providing services to Euroset from September of this year," says
Kevin Cuffe, Vice-President of Golden Telecom. "Without exaggeration, this project can be
called unique in its complexity, scale and technological solutions. We also succeeded in making
the solution work on a variety of platforms, as well as accessible in various cities."
Tatyana Gulyaeva, PR director of Euroset says: "Today it can already be said that thanks to
the efforts of Euroset’s and Golden Telecom’s specialists our company can combine the work of
all branches into one information space using Golden Telecom’s high-quality channels. One of
the main advantages of this corporate network is the possibility of introducing a centralized
enterprise management system which extends to all aspects of the company's life. Incorporation
of all communications stores into a single multi-service network greatly increases data exchange
speed and makes data accessible at any time. The corporate network provides a means for the
formation of a single information database for all divisions and for organization of electronic
document flow. The ability to exchange large data volumes between offices allows us to hold
meetings with remote divisions using conference connections and video conferencing. All this
accelerates the response to the changes taking place in the company and ensures optimal
management of all processes on a real-time basis."
* * *
Euroset is a major company in the field of cellular communications in Russia and one of
major resellers for mobile operators. The main lines of activity of the company are wholesale
and retail trade in cellular phones and accessories, connection to telecommunications operations
in Russia. At present, the company has more than 310 communications stores located in nearly
all districts of Moscow and in more than 50 cities of Russia.
Statements made in this press release are forward looking and are made pursuant to the
provisions of the Securities Litigation Reform Act of 1995. Such statements include expected the
expected roll-out of the network for Euroset, and the further growth of this network. It is
important to note that such statements involve risks and uncertainties, which may cause
outcomes to differ materially from those set forth in these statements. Such risks and
uncertainties include, but are not limited to, the possibility that Euroset may not retain us as a
provider or may not order additional network points. Additional information concerning factors
that could cause results to differ materially from those in the forward looking statements is
contained in the company’s filings with the U.S. Securities and Exchange Commission including
the Company’s periodic reports on Form 8-K and Form 10-Q filed during 2003, the Company’s
annual report on Form 10-K for the year ended December 31, 2002.