SASKTEL WILL MAINTAIN SAME LOCAL RATES

Released on January 2, 1997

Carol Teichrob, minister responsible for SaskTel, today confirmed that
effective Jan. 1, 1997 SaskTel's local access rates will remain the
same. Customers in all other provinces face a minimum rate increase of
$2 per line per month.

In Saskatchewan, SaskTel's local access rates have been frozen since
August 1993. In all other provinces, local access rates increased by
$2 per line per month in January 1996. The CRTC has approved
additional increases of $2 per line for January 1997, and between $2-3
for January 1998. SaskTel's residential local access rates are
presently six to nine per cent lower than the national average of other
telephone companies in Canada.

Traditionally, SaskTel has used long distance revenues to subsidize the
true cost of providing a variety of services to Saskatchewan people -
including local access and directory assistance. Competition in the
long distance market will mean that these revenues will decline over
time.

"SaskTel continues to strive to keep its costs as low as possible, and
to provide Saskatchewan residents with affordable access to a wide
variety of products and services," Teichrob said. "For example,
SaskTel has reduced long distance rates by up to 50 per cent since
1990, and has introduced competitive long distance savings plans for
its customers.

"However, the ability of SaskTel to subsidize local access will not be
sustainable in a competitive marketplace. Local access service will be
one area that SaskTel will need to pay close attention to in the months
ahead."

Adding to SaskTel's costs is the unique challenge of providing local
access to a population of one million people scattered over 652,000
square kilometres. SaskTel spends nearly $100 million per year to
upgrade the province's all digital network. SaskTel was one of the
first phone companies in Canada to complete a fully digital network and
provide individual line service to all its customers.

SaskTel is the leading full service communications company in
Saskatchewan, providing voice, data, Internet, text and messaging
services over a digital network, and cellular, paging and Fleetnet 800
service through its SaskTel Mobility division.

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For more information, contact:

Darcee MacFarlane
Corporate Affairs
SaskTel
Phone: (306) 777-4441