Vistula Communications Services, Inc. enters into agreements with Telstra for Vistula’s O2C Managed Office software platform and the management of customers

October 12th, 2006 New York – Vistula Communications Services, Inc. (“Vistula”) (OTCBB: VSTL), a global supplier of flexible and reliable Voice over IP (“VoIP”) services to major telecommunications carriers and Internet Service Providers, announced today that it has entered into agreements with Telstra Europe Limited (“Telstra Europe”) relating to Vistula’s Order-to-Cash (“O2C”) Managed Office software platform and the management of certain Telstra accounts utilizing the O2C software.

Under the agreements, Vistula has granted a global license to Telstra Europe for the O2C software for the managed serviced office marketplace. Telstra Europe has also outsourced the support and management of their O2C client base to Vistula for a minimum period of eighteen months.

Rupert Galliers-Pratt, Chairman and CEO of Vistula remarked, “Following on from Telstra’s launch of V-Cube™(1) based services in the UK, we are delighted to be working once again with the Telstra team in support of the managed serviced office market which, as well as generating immediate revenue in its own right, is expected to be a source of new customers for the V-Cube™ product set.”

Telstra International Managing Director, Drew Kelton commented, “Large numbers of successful enterprise and corporates start their lives within the serviced office environment. The strength and reach of the internet means that, increasingly, businesses are able to operate in limited or virtual environments. As well as addressing the expanding serviced office marketplace, we view Vistula’s O2C product as a valuable source of new business clients for our whole of business product suite, especially as it interfaces to our own Vistula-provided IP-PBX.”

(1) V-Cube™ - a uniquely featured Internet Protocol-P-B-X, or “IP-PBX,” that facilitates full contact communication services including voice, video, conferencing, call center, interactive voice response systems, and multi/sub-domain and unified messaging across enterprise and public networks.

About Vistula

Vistula is a telecommunications company providing hosted, managed VoIP (Voice over Internet Protocol) services to carriers, 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 trades on the OTCBB under the symbol: VSTL.

About Telstra Europe:

Telstra Europe is a wholly-owned subsidiary of Telstra Corporation Limited (ASX:TLS). Operational in Europe for over 14 years, Telstra offers an extensive range of voice and data services including total managed network solutions using Global IP-VPN (MPLS), Internet, ATM, Frame Relay, Private Lines, hosting and co-location services and enhanced voice solutions to medium sized business and multinational corporations in the UK. Additional value added services include fully managed CPE, network reporting, consulting, planning, project management, service tools, which enable customers to monitor and view their network status 24x7 and customer support seven days a week.

Delivering connectivity business solutions, value-added services and complex managed IP solutions, Telstra Europe’s portfolio is complemented by its independently-owned and managed switched network. Switches are located in London, Birmingham and Manchester working alongside 14 co-location points throughout the UK. Additionally, state-of-the-art, resilient data centres are located in London, Docklands, Cambridge and Sunderland.

Parent company, Telstra Corporation Limited, is a full service global telecommunications company.

www.telstra.co.uk

"Forward-Looking Statements''

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.