Contract Extension with Canada's Leading Virtual Network Operator Demonstrates Continued Demand for Telecom Services

TORONTO, ON, December 16, 2008 - MTS Allstream Inc. ("MTS Allstream") announced today the signing of a three-year, $13.5 million contract extension with Selectcom Telecom. The contract services include a full suite of enterprise telecommunications services such as domestic long distance, international long distance, calling cards, toll free, Multi Protocol Label Switching (MPLS), Internet, local lines and privates lines.

Selectcom Telecom is a fully Canadian-owned Virtual Network Operator (VNO) offering a wide range of integrated communications products and services. The company offers a suite of telecommunications services and has paved the way for other VNOs to offer both traditional and advanced telecommunications services to customers in markets across Canada. The company's strong commitment to offering high quality telecommunications, competitive rates, customized billing and exceptional customer care has been the key to its continued growth and success.

"This contract extension speaks not only to our strong relationship with Selectcom Telecom, but to the continued strength of demand for telecommunications services in the enterprise sector in Canada and how MTS Allstream continues to act as a driving force in ensuring competition for those services," said Dean Prevost, President, Enterprise Solutions division, MTS Allstream. "We are pleased to provide a complete suite of enterprise telecommunications solutions to Selectcom Telecom, and proud to continue to build on our strong relationship with Canada's leading Virtual Network Operator."

"Our long relationship with MTS Allstream continues to grow, based on a strong foundation of operational excellence," said Peter Comito Sr., President and CEO, Selectcom Telecom. "Our goal is to assure that our customers continue to receive first-class communications at a reduced cost for many years to come, and we are excited to extend our relationship with MTS Allstream to help us meet this goal."

About MTS Allstream
MTS Allstream is a wholly owned subsidiary of Manitoba Telecom Services Inc. and is one of Canada's leading national communication solutions providers, delivering innovative products and services through the Enterprise Solutions and Consumer Markets divisions. The Enterprise Solutions division, which operates under the Allstream brand nationally and under the MTS Allstream brand in Manitoba, is a leading competitor in the national business and wholesale markets. This division offers customers a portfolio of solutions tailored to the needs of medium and large businesses looking for success in a world of rapidly evolving technology - IP connectivity, unified communications, IT consulting and security services. The Consumer Markets division leads every telecommunications market segment in Manitoba, delivering a full suite of next generation wireless, high-speed Internet and data, digital television and wireline voice services under the MTS brand, as well as small business services in select markets across Canada under the Allstream brand, and security and alarm monitoring services through AAA Alarm Systems Ltd., an affiliate of MTS Allstream which also operates in other western provinces. MTS Allstream's extensive national broadband fibre optic network spans more than 24,300 kilometres, and provides international connections through strategic alliances and interconnection agreements with other international service providers. Manitoba Telecom Services Inc.'s common shares are listed on The Toronto Stock Exchange (trading symbol: MBT). For more information, please visit: www.mtsallstream.com.