Moscow, Russia – October 1, 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 Moscow City Telephone Network (“MGTS”) added a further 28 thousand broadband internet subscribers in the third quarter to reach over 210 thousand subscribers. MGTS is 55.73% owned by Comstar and is the fixed line incumbent telephony provider in Moscow with over 4.8 million installed lines. MGTS launched its broadband internet access service offering in October 2007.

The increase reflects MGTS’s ability to efficiently promote its broadband internet access services to its voice subscriber base. It also reflects major improvements in service quality delivered by the Group within the framework of the “Comstar-Client-Quality” programme which was launched in the beginning of 2009.

Sergey Pridantsev, President and Chief Executive Officer of Comstar UTS, commented: “Our Group has not only managed to maintain but also significantly increase our broadband internet subscriber base despite the challenging economic situation, saturation of the Moscow internet market and a decrease in our marketing spend. The introduction of a two-level model of broadband internet promotion under the STREAM and MGTS’ brands, as well as our targeted offerings for premium and mass market segments, enabled us to provide our subscribers with a broad range of internet access options. The entrance of MGTS to the Moscow broadband internet access market allowed Comstar not only to attract new users, but also increase loyalty of the Group’s existing broadband internet subscribers.”

Sergey Nazarov, General Director of MGTS, added: “The number of our broadband internet subscribers exceeded the 200,000 milestone due to enhanced client experience boosted by our credit payment system, single billing for all telecommunications services provided by MGTS, session internet access services and pay-TV solutions. We are planning to continue expanding our offering to make our services even more attractive for our subscribers.”