Shanghai is seeking a bigger slice of the mainland’s financial media pie with multimillion-dollar investment plans despite the gloomy outlook for the industry. The city’s media sector is grappling with declining sales and faces an uphill battle in bailing out two troubled broadcasting and newspaper giants. Shanghai United Media Group, a newly created conglomerate, will launch a financial information service provider amid municipal leaders’ push for a greater digital focus, the group said. The new project will be led by He Li, a former chief editor of Caijing magazine. Funding will also be sought from other local and overseas investors, with a goal of US$500 million in total. Optimism for the project appears tied to the city’s ambitions of becoming a global financial centre and its efforts to develop the mainland’s first free-trade zone. But local officials and executives with United Media are also hoping a profitable digital product can offer a boost for the ailing local media sector. Late last year, the local progaganda department, under a directive from Shanghai Communist Party boss Han Zheng, merged the city’s two largest print media companies – Jiefang Daily Group and Wenhui-Xinmin United Press Group – naming the new entity United Media. The merger was part of an attempt to push state-owned print media towards a digital future after years of losing ground to internet portals and social networking sites. United Media has consolidated ties with domestic internet giants such as Baidu and Tencent to produce more value-added content online, but the moves are not enough to offset losses from existing print editions of the newspapers. Sources said United Media looked set to report a loss this year. Qiu Xin, chief executive of United Media, said he would prefer to buy out the contracts of some existing staff before folding the loss-making subsidiary newspapers. At the end of last year, the group closed the Shanghai Evening Post , taking an initial step towards restructuring the group’s business. But if the group stops publishing several of its largest newspapers, there are fears massive lay-offs could be a serious threat to social stability and well-connected journalists could publically raise concerns about local officials or even the government. United Media’s plan followed an ownership change involving the influential Caixin Media, which focuses on financial news, in December. Shanghai-based China Media Capital (CMC) bought a stake in Beijing-based Caixin from Zhejiang Daily Press Group to become its new controlling shareholder. Caixin ’s editor-in-chief Hu Shuli, recognised as one of the most powerful journalists on the mainland, served as chief editor of Caijing for more than a decade before establishing Caixin in late 2009. It was reported the transaction resulted from an arrangement struck up between the management and the state-owned parent press group after the latter sought to exert more editorial control over Caixin. CMC’s investment in Caixin reflects Shanghai’s determination to loosen its grip on local media editorial content. Shanghai Media Group, which owns the city’s major television and radio stations, is also studying plans to conduct drastic reform as its revenue declined sharply last year. The city’s state-owned media have been eclipsed by out-of-town rivals, including the Guangzhou Daily and Chengdu Business Daily , as they can’t publish many in-depth reports due to restraints imposed by the local propaganda department. All eyes will be on city officials, as the industry believe a profitable and influential media product won’t be possible in the mainland’s commercial hub unless editorial staff are given a free hand in producing stories.