Moscow, Russia – November 13, 2009 – “COMSTAR – United TeleSystems” JSC (“Comstar” or “the Group”) (LSE: CMST), the largest integrated telecommunications provider in Moscow and 69 Russian cities, today announced that it has fully launched a backbone multiservice fibre-optic network between Moscow and Rostov-on-Don. The overall investment in the project amounted to approximately RUR 146 million (US$ 5.1 million[1]).

The new telecommunications network was soft launched at the end of August 2009 and forms the main part of a bigger network connecting Moscow with the South of Russia, the construction of which commenced in 2008.

The new Comstar-UTS network, spanning approximately 1,350 km and with a data transmission speed capacity of 10 Gigabits per second, passes through Tula, Lipetsk, Voronezh, Kamensk-Shakhtinsk, Shakhty and Novocherkassk. ECI equipment has been used in the project, with the application of Dense Wavelength Division Multiplexing technology.

Comstar’s transport optic infrastructure enables transmission of both voice and data telecommunication traffic on an IP protocol basis, and allows Comstar to provide its local subscribers with a full range of fixed-line telecommunications services, including long-distance connection, broadband internet access and pay-TV.

Sergey Pridantsev, President and Chief Executive Officer of Comstar UTS, commented: “The completion and full launch of Comstar’s first backbone multiservice fibre-optic network is an important stage in the development of the Group. Our presence in the backbone connection market is expected to be based not only on new network capacity, but also on the synergy achieved from the use of backbone networks of Comstar and our new shareholder, MTS.”

Viktor Koresh, Vice President for the Regional Development of Comstar UTS, added: “We are happy with the results of the trial run of the network between Moscow and Rostov-on-Don. The network’s launch will enable us to provide efficient and high-quality telecommunication services in the regions through which the network runs. This will allow us to increase the amount of traffic, offer our customers both competitive prices and high speed internet connection, as well as expand our presence in the telecommunications market and reduce the cost of leased channels.”

[1] Based on the Bank of Russia exchange rate as at November 13, 2009