ATSI Launches 'MEXICOnnect' Service; Complements 'borderless' strategy between Mexico and U.S.; Offers significant discounts over AT&T basic rate plan.

SAN ANTONIO--(BUSINESS WIRE)--July 1, 1998--

American TeleSource International, Inc. ("ATSI") (OTC BB:AMTI)

Chief Operating Officer, Randy Poole, today announced the launching of ATSI's new "dial around" service, MEXICOnnect(tm).

The MEXICOnnect service, which is accessed by dialing 1010-624 from any household or business telephone, was developed specifically with the growing Hispanic market in mind. This service allows for more affordable long distance calling to Mexico and complements ATSI's existing product lines currently offered throughout that country. ATSI is provisioning this service throughout San Antonio, and anticipates the expansion of 1010-624 into several other Texas Metropolitan markets over the next six months.

The 1010-624 access code plus the telephone number, is a dialing method permitting "by-pass" of the caller's pre-subscribed long distance company, allowing the call to be carried via ATSI's network. Consumer use of access codes to make long distance calls has become increasingly popular. Recent surveys indicate that 10% of U.S. households used these access codes during 1997. As a result, total industry sales for these services in 1997 were estimated at approximately $1.5 billion, and are predicted to reach $2.65 billion in 1998.

Commenting on the new service, Mr. Poole stated, "We are very excited to bring MEXICOnnect to the marketplace, capitalizing on the increasing demand for dial around service. 1010-624 fits nicely into the Company's strategic plan of developing a host of "borderless" communication services between Mexico and the United States. Our market edge is that we can transport calls in and out of Mexico at competitive rates through the utilization of our proprietary network infrastructure and interconnection agreements."

MEXICOnnect's convenient features include no monthly service fees or surcharges, no per call or time minimums, no registration requirements, but simply international long distance service to Mexico allowing for significant discounts over AT&T's basic rate plan. ATSI's initial marketing efforts combine traditional mediums such as billboards, bus interiors and exteriors, along with full page advertising on the inside cover of Alliance Media Group's new Yellow Pages Directory, which reaches approximately 625,000 households and businesses throughout the San Antonio Metropolitan area.

American TeleSource International, Inc. is a four-year-old telecommunications entity that is rapidly becoming a competitive force in niche services within the demonopolizing, underserved markets throughout Latin America, primarily Mexico. ATSI owns the San Antonio International Teleport, located at its corporate headquarters in San Antonio, Texas, providing networks for voice, data, fax, and Internet, as well as call services for domestic and international long distance.

ATSI has overcome high barriers to entry, giving it an advantage over certain competition. ATSI's bilingual, bicultural team has diligently focused on the acquisition of unique licensing, execution of interconnection agreements, deployment of network facilities and investment in distribution channels.

    CONTACT:  American TeleSource International, San Antonio
               Karen R. Mella, 210/375-1203
               [e-mail]
               http://www.atsi.net