April 10, 2008, Moscow: COMSTAR – United TeleSystems JSC (COMSTAR-UTS JSC, LSE: CMST), the leading supplier of integrated telecommunication solutions in Russia and the CIS has held a telephone conference to discuss the Group's regional strategy.

About 50 journalists from Moscow and other regions of Russia participated in the conference.

Sergey Pridantsev, President of COMSTAR-UTS, and Viktor Koresh, Vice President for Regional Development of COMSTAR-UTS, answered the questions during the conference. They described the Group's regional development strategy, which had been approved by the Board of Directors of COMSTAR-UTS on March 28, 2008.

Regional development is one of the main directions of the COMSTAR-UTS' general development strategy approved by the Company's Board of Directors in October 2007.

Today, COMSTAR-UTS is present in five federal districts of Russia: Central, North-Western, Southern, Privolzhye, and Ural. The telecommunication market of Siberia Federal District is also attractive for the Company. COMSTAR-UTS is going to gradually integrate the operators already acquired and to be acquired to create a single operating company with branches in the federal districts. By 2011, COMSTAR-UTS intends to increase its share on the alternative market in the regions of its presence up to 30% at least. According to forecasts, revenues from the regional business may amount to more than USD 600 million in 2011.

COMSTAR-UTS' development on the regional market is comprised of three components. These are organic growth, entering new regions through assets acquisitions, and providing long-distance communication services.

Organic growth: The Group's level of presence will grow through extending the network, launching new projects and minor acquisitions, which allow for easy integration into the existing branches. The program for the existing assets development is based on the principles of "keeping the company's income growth rate above the market."

Acquisitions: COMSTAR-UTS' regional development strategy also provides for entering new target regions and increasing the number of cities in the regions of presence. It is planned to acquire the largest and most competitive regional companies, which take the first or second positions on the local markets after the main operator. Sergey Pridantsev, President of COMSTAR-UTS, stressed, "We are going to be present in all the cities of Russia with a population of over 250 thousand people. Growth drivers will be not only corporate customers, for whom telephony and broadband access will be the basic services, but also individual subscribers which will be provided with such services as Triple Play."

Long-distance domestic and international communications: The Company will enter the long-distance communications market before the end of the first half-year 2008. Moreover, COMSTAR-UTS will commence building its own optical backbones already this year. This will provide COMSTAR-UTS with a number of benefits, including an opportunity to offer competitive rates to the regional subscriber base while reducing operating expenses. "We expect the COMSTAR OTS to realize in the nearest years the program for building its own primary long-distance domestic network to extend to the cities in the Southern, the Volga, and the Ural Federal Districts", said Viktor Koresh, the Vice President for Regional Development.