COMSTAR pay-TV subscribers exceed 2 million in 1Q09

Tuesday, May 26th, 2009

MOSCOW, Russia — “COMSTAR – United TeleSystems” OJSC (“Comstar” or “the Group”) (LSE: CMST), the largest integrated telecommunications provider in Moscow and 69 Russian cities, today announced its unaudited consolidated US GAAP financial results for the three months ended March 31, 2009.

Broadband in Moscow

The number of triple-play subscribers (voice, broadband internet & pay-TV) decreased quarter on quarter due to customers optimizing their spending in the adverse economic climate.

Broadband in the Regions

Following the consolidation of STREAM-TV Group, the Group’s target residential audience for triple-play services in the regions increased from 137 thousand to 3.7 million homes passed.

Over 50% of the potential households, or 1.9 million active subscribers, were using pay-TV services by the end of the first quarter of 2009. This included 378 thousand subscribers to low-cost packages comprising 20 TV channels. Pay-TV subscribers using pay-TV packages are more likely to switch to extended offerings, which drives pay-TV premium ARPU growth.

Pay-TV subscribers (000s):

            Q1 2009  Q1 2008  Growth  Q4 2008  Growth
            -------  -------  ------  -------  ------
Moscow          137      135      2%      146    (6%)
Regions       1,953      107   1720%      153   1174%

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