China Telecom (NYSE: CHA; 0728.HK) recently announced the evaluation results of its in-house incubation program, selecting 14 projects involving M2M, mobile internet, cloud computing, and e-commerce. 10 of these projects are in the initial incubation stage, while the other four have already entered the second incubation stage. In the first stage, projects receive RMB 50,000 to RMB 100,000 from China Telecom, while in the second stage they receive RMB 5 mln in funds. All projects operate out of China Telecom's Shanghai incubation base.
China Telecom established a RMB 100 mln employee incentive incubation fund and a dedicated incubation base in early 2012. Employee start-up teams of 3-8 people, after submitting a project plan and receiving approval from the new project evaluation committee, enter the Shanghai base and work full-time on the project under a start-up business model, with financial support from China Telecom. Start-up employees retain their existing job, with their position and salary frozen, for 1-2 years, after which they can choose whether to return.
Editor's Note: For more background on this topic, please see "China Telecom Reveals Incubation Program Details" MD 2/06/12 issue.