Moscow, Russia – April 29, 2008 – “COMSTAR – United TeleSystems” JSC (“Comstar” or “the Company”) (LSE: CMST), the leading integrated telecommunications operator in Russia and the CIS, today announced that it has launched local NGN-based fixed-line telecommunications networks in the Russian cities of Saratov and Engels.

Comstar’s subsidiary in the Saratov region, Conversia-Svyaz, has built and launched the NGN network, based on the SURPASS hiE9200 platform, and an IP MPLS support and transport network in Saratov and Engels.

The launch of the NGN networks increases the number of subscriber lines by 10,000, and the population of the central district of Engels is being provided with access to modern digital telephony services. The Company plans to continue expanding the network, in line with the increasing demand for telecommunications services. In addition, Comstar intends to start providing regional connection services in the Saratov region by the end of the second quarter.

The overall investment in building the combined local and regional connection node, including the NGN networks in Saratov and Engels, as well as fibre-optic connection between the two cities, amounted to over US$ 2.5 million and includes US$ 1 million of spend on building external facilities for the local telecommunications network.

Viktor Koresh, Vice President for the Development of the Group’s Regional Operations, commented: “Our goal is to provide all our clients – both residential and corporate – with equal access to a whole range of modern telecommunications solutions and triple-play services. The new facilities for local telecommunications connection in the Saratov region create a support network for providing a broad range of NGN services, and give us an obvious competitive advantage over regional operators utilizing the traditional networks.”

Conversia-Svyaz currently offers a broad range of services to residential and corporate clients in Saratov, including digital telephony, high-speed internet access based on ADSL2+ technology, Ethernet technology and wireless access. Apart from local fixed-line telecommunications services, Comstar also provides high-speed broadband internet access (up to 24 megabits per second - based on ADSL2+ technology, and up to 100 megabits per second based on Ethernet technology), leased channels, VPN services and video conferencing in Engels and Saratov.

Comstar intends to use its Conversia-Svyaz subsidiary, acquired in 1995, as the platform for the development of its Saratov regional branch.