AH Belo, publisher of The Dallas Morning News and Providence Journal, is climbing on board the newspaper pay cut train to save money as the print business flounders.

Usually when this happens, investors sell what little of the depleted, deflated stock they already own. Today, AH Belo is up 8.7 percent. We assume that is not because they see positives in the “streamlining” of the business. The whole market is up.

This, friends, is what they call bad news.

Excerpts from Chief Executive Robert Decherd’s memo to employees:

On Tuesday, the Board of Directors approved my recommendation to reduce my base salary by 20 percent and the base salaries of other Management Committee members by 15 percent, effective immediately. In addition, all full-time employees making more than $25,000 per year will have reductions in base salary as follows:

Base Salary % Reduction
$25,000 and under 0 %
$25,001 - $74,999 2.5 %
$75,000 - $102,499 5.0 %
$102,500 - $149,999 7.5 %
$150,000 - $225,000 10 %
Over $225,000 15 %

These changes will be effective starting in the payroll cycles on or near May 1. The annual savings represented by these reductions exceed $10 million. We will ask employees who are covered by collective bargaining agreements to voluntarily lower their salaries by the levels described above. …

Our hope is to restore most or all of these cuts for impacted employees at some time in the future, as business conditions permit. To cushion the impact of the wage cuts, all impacted employees will receive three additional personal days per calendar year, effective at the time of the salary reductions. …

These decisions are not taken lightly and all are made with a focus toward maintaining A. H. Belo’s ability to be the leading provider of local news, information and advertising in the markets it serves. The cost-reduction initiatives we have implemented have real consequences and everyone is affected in some way.

As conditions improve - which they inevitably will - we expect to look back at these steps as being painful but necessary for the long-term prosperity of our great Company.

(Photo: Reuters)

Another good reason to read lots of newspapers: You end up coming across all sorts of crazy ways to save the newspaper business. One of the most interesting that we’ve found so far comes from The Dallas Morning News, where Lazard executive John Chachas lays out some bold steps that the U.S. government could take to help save the press. (No, we’re not talking about financial support or “bailouts”.)

As he says in his introduction:

By the end of this year, some of America’s biggest dailies may well be run by their lenders. There is little evidence that banks would serve us well as the chroniclers of the nation’s news.

That’s because ad revenue is diving, costs are fixed, debt is threatening to shut down publishers and the papers have not yet found a way to make more money. So what can the government do? Wake up, Chachas suggests:

The Justice Department, the Federal Communications Commission and even the U.S. Senate have all, for decades, held that combining local dailies or owning papers along with other local media is anti-competitive. This is nonsense. Antiquated anti-trust laws have been extended to apply not just to the local concentration of economic power but also to how many “voices” there may be in a defined market. Yet somehow voices refer only to print. Regulators fail to consider the Internet or even cable TV as local competition.

The regulators’ insistence on a narrow product market definition is particularly inconsistent given their recent willingness to define the market more broadly in other contexts, such as in the merger of XM and Sirius. It is as if regulators went to sleep during the Eisenhower administration and woke up staring blankly at an iPhone.

Chachas says newspapers are the most trusted, credible source of local news and that their “imminent demise isn’t just some abstraction of destructive capitalism.” (We’ll drink to that.)

So here are his suggestions:

• Redefine “market” truthfully - all local media. “Combinations of geographically adjacent papers is one logical path to create efficiency,” he says.
• Grant the industry a short-term anti-trust exemption. Newspapers should be granted a finite (36-month) anti-trust law exemption to permit deployment of an industry-wide system to track and charge for re-use of their content.
• Eliminate local media cross-ownership restrictions that prohibit common ownership of newspapers and TV stations in the same market. (Robert Decherd, who runs A.H. Belo Corp, the company that owns the Dallas Morning News, is a big proponent of that, as luck would have it.)
• Allow in-market mergers. “If two papers in a market need a special exemption to set unified pricing, the market probably isn’t big enough for two papers.”

Those are some pretty hefty ideas, not your typical airy thoughts about “rethinking the paradigm.” In fact, maybe it’s time to add Chachas to the big newspaper thinker’s debate over at The New York Times website.

(Photo: Reuters)

Dallas Morning News and Providence Journal publisher AH Belo Corp is getting some online representation. David Morgan,  who worked at Time Warner’s AOL between September 2007 and February 2008, is joining the Dallas-based company’s board, the Morning News reported on Thursday.

Morgan was founder of Tacoda and Real Media. See Buzzmachine proprietor Jeff Jarvis’s short, complimentary writeup about Morgan here .

Also joining is John Puerner, former publisher of the Los Angeles Times, whose territory butts up against Belo’s Press-Enterprise daily newspaper in Riverside County, California.

Mr. Puerner, 56, a private investor, spent most of his career with Tribune Co. He was publisher, president and chief executive of the Los Angeles Times from April 2000, shortly after Tribune agreed to acquire it, until May 2005, when he retired from Tribune.

And here’s the simple, if somewhat vague reasoning:

“Their backgrounds in both print and Internet media will add crucial insights to the board’s deliberations,” said J. McDonald Williams, lead director of A.H. Belo.

Belo, which recently split from the larger Belo Corp (which remains a television broadcasting company), is yet one more U.S. newspaper company trying to manage the downturn that papers have been going through as print advertisers chase the readers who are leaving newspapers in favor of getting their news online.