Vistula Communications and Brainware S.A. announce the launch of Vistula’s Hosted IP-PBX Service in Argentina

NEW YORK – July 12, 2006 -- Vistula Communications Services, Inc. (OTC Bulletin Board: VSTL), a global supplier of flexible and reliable Voice over Internet Protocol ("VoIP") services to major telecommunications carriers and Internet service providers, today announced that BrainWare S.A. has officially launched their V-Cube™-based Hosted IP-PBX Service across Argentina.

Ricardo Ciciliani, President of BrainWare S.A. said “We are very happy to announce that on July 1st, 2006, we became one of the very first telco carriers to offer retail VoIP based products to the Argentinean market. We are focusing our efforts on SOHO products and a completely hosted IP-PBX service that we will market to small and medium sized enterprises across Argentina.”

Ricardo went on to say, “What we have here is the opportunity to be the first to market with a truly hosted IP-PBX solution. Thanks to Vistula Communications’ V-Cube, we were able to launch this service well within the time frame we had established. Additionally, this platform allows us to deliver VoIP based products and services, not yet seen in our market. We are very pleased with this accomplishment and look forward to servicing the market and our clients with a truly world class solution."

Bundled products and services of world class

BrainWare will now be able to market complete communications packages to enterprises. For the first time in Argentina, BrainWare will offer a bundled product offering broadband, IP-PBX and voice traffic together by one provider, in one bill. This hosted PBX product will also give customers real control over their telecommunication services, through a variety of call features and administrative capabilities, not currently available.

Rupert Galliers-Pratt, Chairman of Vistula Communications said “BrainWare is the first of our customers in South America to launch a hosted IP-PBX service. There is significant opportunity in these markets for our customers to build traction with business clients and we are delighted that BrainWare has become the first to launch and start signing up and connecting customers. With the Telstra launch announced yesterday, Vistula is now entering a period where the customers that we have contracted are launching service and will be generating revenues from the deployment of Vistula’s IP PBX solution.”

About Vistula
Vistula is a telecommunications company providing hosted, managed VoIP (Voice over Internet Protocol) services to carriers, cable operators, service providers and transit network operators. Vistula features solutions that enable telecommunications providers to rapidly deploy VoIP services over converged infrastructure through an integrated applications suite. Vistula has already signed Telstra Global business unit, as well as IUSACom in Mexico, among many other international carriers and ISPs that have installed or are currently testing the V-Cube(TM) platform. Vistula trades on the OTCBB under the symbol: VSTL. For more information visit: http://www.vistula.com.

About BrainWare
BrainWare has established itself as one of the most innovative ISPs in the sector. The company was one of the first pioneers of broadband internet in Argentina, developing the first commercial LAN broadband ISP brand named “ MaderoNet ” . The company’s philosophy is to provide and constantly seek to improve the range of value-for-money products and services and to back these up by first class customer support. The fact that the majority of customers have come from personal recommendation is testimony to the company ’ s core beliefs that BrainWare has undeniably established its credentials as one of the most innovative companies in Argentina, reacting quickly to take advantage of the latest technological developments for its clients.

This announcement shall not constitute an offer to sell or a solicitation of an offer to buy any of these securities. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act.

This press release contains certain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, which reflect management's expectations regarding future events and speak only as of the date hereof. Our actual results, performance or achievements may differ significantly from the results, performance or achievements discussed in or implied by the forward-looking statements. Factors that could cause such a difference include material changes in our business or prospects, difficulties obtaining financing to fund our operations, failure to establish brand recognition for our products, failure to retain existing customers or attract new customers, failure to compete effectively in our industry, general market and economic conditions, and other factors that are detailed from time to time in Vistula's SEC reports, including those detailed in our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005. Vistula disclaims any intent or obligation to update any forward-looking statements.

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