Moscow, Russia – February 29, 2008 – “COMSTAR – United TeleSystems” JSC (“Comstar” or “the Company”) (LSE: CMST), the leading combined telecommunications operator in Russia and the CIS, today announced that its Board of Directors adopted the Comstar Group strategy on technology, finance and marketing.

Comstar is focusing on the technological development of the infrastructure in the regions, integration of the network of companies, development of broadband access technologies, increase in the capacity of its networks and creation of technical capabilities for fast introduction of its services.

The modernization of the transport level of data transmission network and ‘the last mile’ based on FTTH technology are Comstar’s technological priorities in Moscow.

The technological development of the regional network of companies will follow the Moscow network’s model and will allow Comstar to shorten networks rollout and reduce time required for the introduction of new services. Unified technological solutions and cooperation within the Group’s companies is essential for the efficiency gains within Comstar.

The introduction of a number of initiatives with respect to the financial strategy is expected to deliver the targeted growth, profitability and increased market presence through higher operational profitability, effective use of the investment portfolio as well as optimization of the Group’s ownership structure. Comstar’s financial goals in 2008 are focused on the introduction of management control systems for revenue assurance, separate cost accounting and project accounting for investments, as well as increased financial disclosure and reduced preparation time of the Group’s consolidated financial results.

Comstar’s marketing strategy is focused on increasing sales and market share in respective businesses, dynamic regional expansion in Russian regions and the CIS, including rebranding, increasing loyalty among broadband customers through improving quality of services and customer support as well as developing the brand further.

Sergey Pridantsev, President and Chief Executive Officer of Comstar UTS, commented: “The execution of adopted strategies is in line with the implementation of key strategic goals by Comstar UTS through 2011. The “Five attack points” strategy adopted by the Board of Directors in October 2007 is focused on: restructuring, development of broadband access business, development of MGTS, dynamic regional expansion and management of the Svyazinvest stake.”