Golden Telecom Expands Network

MOSCOW -- Golden Telecom, Inc. (NASDAQ: GLDN), a leading independent provider of integrated telecommunications and Internet services operating in Russia and other countries of the Commonwealth of Independent States (CIS), announces that it has completed construction of its own Federal Transit Network (FTN).

Golden Telecom's FTN has been constructed in compliance with the Russian telecommunications rules and regulations that came into force on January 1, 2006, and in compliance with Golden Telecom's Russian Long Distance License obtained in 2005. The FTN consists of four international communications transit nodes (two of which are located in the European part of Russia, and two of which are located in the Asian part), seven intercity communications transit nodes (deployed in each federal district of Russia), and 88 connection points or FTN access nodes (located in each constituent territory of Russia).

Required governmental permissions have been obtained for operation of all of Golden Telecom's international and intercity communications transit nodes that are part of the FTN. Construction of 88 connection points has been completed and is pending formal commissioning by governmental agencies (RosSvyazNadzor). Golden Telecom soon expects to be assigned both carrier and network selection codes as a provider of international and intercity communications services.

Prior to the FTN launch, Golden Telecom provided long distance services exclusively to customers and operators connected directly to the Company's local digital networks. The FTN allows Golden Telecom to continue to provide long distance services to its current customers in compliance with new laws and regulations. The FTN also allows Golden Telecom to expand its network to reach the approximately 40 million potential customers throughout Russia. According to the IKS-Consulting agency, the size of the Russian long distance market is approximately 8 million business customers and 32 million residential subscribers.

"Currently our Company is one of only two alternative operators that have fulfilled all the requirements for utilizing the Russian long distance license which allows the Company to provide long distance services over the whole territory of the Russian Federation," commented Jean-Pierre Vandromme, Chief Executive Officer of Golden Telecom. He added, "Our long distance market strategy is targeted primarily at growing our market share due to the increase of the addressable and accessible market through the expansion of our geographic network coverage. While continuing our focus to provide intercity and international communication services to our corporate clients, the opportunity now exists for us to potentially increase our presence in the consumer target segment and the very promising and growing Small Medium Enterprise [SME] and Small Office Home Office [SOHO] target group."

Golden Telecom Inc.