For Immediate Release

New York – August 16th 2005

Vistula Communications Services Inc (“Vistula”) announced today that it has agreed to install the V-Cube™ VoIP platform on trial in Transtel’s network in South Africa. Transtel will conduct a series of tests to prove the interoperability of the system with its own and other VoIP systems, before finalising an agreement for the distribution of Vistula’s V-Cube™ based services in South Africa.

V-Cube™ will be demonstrated as a central system to deliver a range of hosted VoIP telephony products to business enterprise customers in South Africa. Vistula will integrate its web portal set with Transtel’s existing client and operational systems to give a cohesive client front end. This will facilitate client sign-up and allow those clients straightforward control of their telephony environment.

Karl Socikwa, CEO of Transtel, said, “Transtel is investigating possible IP solutions for its customers. We look forward to moving ahead with Vistula on demonstrating an IP product suite to our existing and new business customers in South Africa."

Rupert Galliers-Pratt, Chairman and CEO, Vistula, commented, “Transtel is a substantial government owned network in South Africa. We have been working closely with their relevant executives over the past three months and we hope to move to contract once the testing phase has been completed to the satisfaction of all parties."

About Transtel

Transtel is the telecommunications division of Transnet Ltd, the South African transport giant. Transtel is a full-service private telecommunications operator, with services spanning both the specialist transport environment and general telecommunications.

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.

"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 Communications Services’ SEC reports, including those detailed in our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004. Vistula Communications Services disclaims any intent or obligation to update any forward-looking statements.

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