A proposal to merge Shanghai’s two leading newspaper conglomerates, Wenhuixinmin United Press Group (WUPG) and Jiefang Daily Group (JDG), has been approved by the country’s regulators, Chinese media reported.
Experts say they anticipate more reforms as the city takes its first steps towards encouraging its media organisations to adapt and ultimately thrive in a booming new media age.
The merger was announced after both groups,each publishing some of the most reputable and profitable newspapers in Shanghai and the country, saw a drop in their newspaper and magazine revenues, said Wei Wuhui, a Shanghai-based media researcher and columnist at TMT Post, an independent website focusing on technology and media.
The merger of the two giants would reduce costs and improve efficiency, said Wei. But he said it could take months for the two groups, both burdened by the bureaucracy of state-owned firms, to find common ground and hash out HR and operational details for the new entity.
Besides printing five daily papers, including the English language Shanghai Daily, WUPG publishes six weekly papers and six news magazines while JDG runs 10 newspapers, four magazines, one website and one publishing company, according to their websites.
Both groups have invested in high-growth industries such as real estate and finance. As a major stock holder of Hong Kong-listed Haitong Securities and the currently unlisted Oriental Securities, WUPG reportedly holds securities worth billions of yuan.
JDG, on the other hand, owns 23.49 per cent of Shanghai-listed Xinhua Media. Shanghai Morning Post, a paper the group launched in 1999, grossed hundreds of millions yuan in its good years, according to a TMT report. 
Qiu Xin, a media veteran who worked as deputy chief at both groups, would head the new organisation, said the report.
Shanghai, the financial centre of China, has lagged behind its neighbours in attracting IT talent and incubating internet technology startups in recent years, an issue the city’s leaders seem determined to address.
While Wei said he had received several calls from city officials wanting to pick his brains about Shanghai’s new media strategy, the city’s party chief, Han Zheng, reportedly said in an internal meeting that Shanghai should “try its best to succeed in the new media sector,” said a TMT report. 
“Shanghai media organisations need to think out of the box and be open-minded,” Wei said. He suggested that the new company should levy Shanghai’s advantages as China’s financial hub and encourage innovation and start-ups.
While Wei saw the merger as a business-motivated move, Peng Zengjun, a journalism professor at Saint Cloud State University in Minnesota, in the US, said the merger could be a government attempt to tighten control over the media industry.