Yangtze Briefing | Building a future to fend off tide of red print ink
Shanghai's print propaganda arm is looking to its property and financial assets to secure its survival as income from advertising plummets
It's been almost a year since the Shanghai authorities brought nearly all the city's major newspapers under the one giant umbrella of the Shanghai United Media Group in a desperate bid to staunch the flow of red ink and turn the city's propaganda machines into genuine market competitors.
But as the group confronts its first-half results, it's becoming abundantly clear that its survival and growth will depend not on editorial content but on its prized assets: property.
Group general manager Gao Yunfei told an internal meeting this year that amid a sharp fall in advertising sales, the media giant's property assets would be the key to invigorating the group's businesses.
According to a transcript of the meeting obtained by the South China Morning Post, Gao sounded the alarm over the slumping media businesses, saying the group would continue to dispose of loss-making newspapers and lay off redundant employees.
The decline of the print operations continues despite the massive overhaul of the industry directed last year by the city's top party brass.
Shanghai Communist Party boss Han Zheng ordered the creation of the group last year from the merged operations of the Jiefang Daily Group and Wenhui-Xinmin United Press Group. The idea was to strengthen the industry's financial muscle and improve editorial quality. It was seen as a make-or-break decision for the local government mouthpieces trying to fend off challenges from online social-networking services.