MegaFon : and Rostelecom Agree to Jointly Develop 5G

As part of the cooperation, MegaFon and Rostelecom will develop optimal scenarios for rolling out 5G networks based on international experience and subject to the specifics of the Russian mobile communications market. The companies consider possibility of setting up a joint venture that would act as a single infrastructure operator for construction of 5G networks in Russia.

MegaFon and Rostelecom plan to set up a working group that will propose options for rolling out 5G networks in the 3.4 - 3.6 GHz and 26 GHz frequency bands. This will include giving consideration to the government program on the Digital Economy of the Russian Federation. Special attention will be paid to identifying and freeing up available space in the spectrum for 5G networks.

'In the current market conditions, the most logical and cost efficient option for deployment of the new standard is cooperation between several players. We are already working together successfully with Rostelecom as part of the working group on Information Infrastructure under the government program for Digital Economy and we see huge potential for further cooperation. I am confident that, through joint efforts, 5G can become the foundation for technological development in a number of sectors of the digital economy,' said MegaFon CEO Sergey Soldatenkov.

'For our company, one of the main aspects of the Digital Economy program is building the infrastructure that is needed for it to be created and function. Clearly 5G will become one of the technologies that forms the foundation for the digital economy,' commented Rostelecom President Mikhail Oseevskiy. 'We believe that the creation of a fully-fledged 5G mobile network in Russia will require market players to join efforts. Our partnership with MegaFon is designed to demonstrate the success of such an approach to rolling out 5G networks.'

Both companies are actively involved in promoting the 5G standard together with leading international hardware manufacturers. For example, MegaFon is working on issues around the roll out of 5G as a member of GSMA, the international organization of mobile operators. This year, at the St Petersburg International Economic Forum, MegaFon set a record for the fastest ever mobile internet connection in Russia, demonstrating the operation of a 5G network at speeds of 35 GB/s. MegaFon is also the first mobile operator to obtain the 3400 - 3800 MHz and 25250 -29500 MHz frequency bands to deploy test 5G zones for the FIFA 2018 World Cup.

Rostelecom has the necessary network infrastructure, radio frequencies and project experience. Earlier the company signed an agreement to build 5G networks at Innopolis, the Skolkovo Innovation Center and the State Hermitage Museum.

For More Information:

Notes to Editors

5G is the next generation standard for radio systems and network architecture that supports high data transfer speeds and the processing of large volumes of traffic with highly reliable connection, low lag and large-scale incorporation of Internet of Things devices to achieve a diverse range of objectives for society.

MegaFon PJSC is a leading Russian integrated telecommunication service provider, operating in all segments of the telecommunications markets in Russia, and in the Republics of Abkhazia, South Ossetia and Tajikistan. MegaFon is a recognized market leader in the provision of mobile data services, was the first operator in Russia to launch commercial operation of a third generation (3G) network and was the first operator in the world to launch commercial operation of an LTE-Advanced (4G) data network. MegaFon is traded on the Moscow Exchange and the London Stock Exchange under the symbol MFON. Additional information about MegaFon and the products and services provided by MegaFon can be found at: http://www.megafon.ru

Cautionary Statement Regarding Forward Looking Statements

Some of the information in this document may contain or refer to projections or other forward-looking statements regarding future events or the future financial performance of the Company. You can identify forward looking statements by terms such as 'expect', 'believe', 'anticipate', 'estimate', 'forecast', 'intend', 'will', 'could', 'may', or 'might' the negative of such terms or other similar expressions. The Company wishes to caution you that these statements are only predictions, and are based upon various assumptions which are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control. We may not achieve or accomplish these plans or predictions. The Company does not necessarily intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries in which the Company operates, as well as many other risks specifically related to the Company and its business and operations.

Statement Regarding Inside Information

Some of the information in this document may be inside information. The subject matter, the identity of the issuer, the identity of the persons making the notification and their titles, and the date and time of the notification are all as set forth above.