The News and Observer from Raleigh, North Carolina • D1

For the latest stock information, news and quotes, go to www.newsobserver.com, keyword: stocks DOW 25.05 at 10,622.88 NASDAQ 1.24 at 2,090.00 AMEX 2.12 at 1,387.97 NYSE 21.73 at 7,076.94 500 4.15 at 1,187.89 10-YEAR NOTE YIELD 4.263%, down from 4.283% 10 20 30 40 50 60 70 80 90 10 20 30 40 50 60 70 80 90 1D, FRIDAY, JANUARY 7, 2005 DTHE NEWS OBSERVER BusinessMOVIESA theater chain announces plans for a second multiplex in Apex before the first one is done. Both would be near the intersection of N.C. 55 and U.S. 64. PAGE 3D FRIDAY, JANUARY 7, 2005 DOLLAR The dollar makes gains against the euro.

But analysts expect the rise to be short-lived because of the increasing U.S. trade and budget deficits. PAGE 4D Airlines follow fare cuts AMERICAN MAKES BROAD REDUCTIONS AFTER DELTA; OTHERS MAKE FOCUSED CHANGES Passengers with American Airlines, such as these at Dallas-Fort Worth, can take advantage of broadly lower fares, but the airline did not cap prices. AP FILE PHOTO United customers wait in Chicago. The airline lowered some fares.

AP PHOTO BY NAM Y. HUH Startup hires its first CFO TV station may go digital Sign of growing ambitions BY MATTHEW BARAKAT THE ASSOCIATED PRESS ALEXANDRIA, Va. Airline woes are piling up as carriers seek to cut costs amid higher fuel prices and a new round of price competition. Machinists at US Airways, the seventh-largest carrier, were facing pay cuts of up to 35 percent and the loss of thousands of union jobs after a bankruptcy judge on Thursday for the first time in U.S. airline industry history unilaterally terminated a union collective bargaining agreement.

The main hub for flights employs more than 5,000 workers in Charlotte. Fifth-ranked Continental Airlines also said in a regulatory filing Thursday that it needs $500 million in wage and benefit reductions by Feb. 28 or it will face a liquidity crisis. And while pilots at No. 2 United Airlines ratified a new cost-cutting contract, the push to lop $725 million off annual labor costs by mid-January is heading to a court showdown today unless other unions ap- prove new contracts.

US Airways, Continental, United and other large airlines are struggling to cope with a combination of higher fuel costs, relentless price competition typified by announcement by Delta of a new lower-fare structure, and the growth of low-cost carri- ers such as JetBlue and Southwest. The Air Transport Association estimates, based on Department of Transportation data, that in 2004 all U.S. carriers spent BY SUSAN STOCK STAFF WRITER Belk will eliminate a rival and gain space with the purchase of four de- partment stores in Eastern North Carolina. Charlotte-based Belk said Thursday that it will buy four of the nine in the state from Saks, which owns the Alcoa, chain. In Kinston and Rocky Mount, Belk will close its new acquisi- tions.

In Greenville and Goldsboro, it will use the locations to expand. Combined, the stores represent 272,000 square feet and employ about 300 people. Terms of the deal were not released, al- though Belk said it will assume the leases. All four of the stores at Vernon Park Mall, Rocky Golden East Crossing, Colonial Mall and Berkeley Mall will close by the end of February. In Greenville, Belk plans to move its and mer- chandise into the former location.

The and home departments will re- main in the existing Belk store. In the Goldsboro mall, home and departments will move to the old Both conversions are to take place in April. The stores had been marketed as a pack- age, but executive vice president, Steve Pernotto, said it was still an attrac- tive deal. decided to go ahead and make the purchase, and we think there will be good long-term he said. The employees may transfer to other Saks-owned stores, might be hired by Belk, or will get severance packages, said Julia Bentley, a Saks spokeswoman.

Saks sold the stores, which ac- quired from in 1998, because they were underperforming, Bentley said. just meeting our prof- itability will continue to operate 23 stores in the Southeast. BY BRAD FOSS THE ASSOCIATED PRESS Fare cuts aimed at business travelers spread through the airline industry Thursday, with American Airlines, the na- largest carrier, imitating Delta Air decision to sharply reduce the price of tickets booked at the last minute. Rivals United Airlines, US Airways, Con- tinental Airlines and Northwest Airlines, which are also under assault by rapidly ex- panding low-cost carriers, took a more lim- ited approach, matching cuts in some markets where they compete head-to-head. a super major overhaul to the sys- said Tom Parsons, chief executive of BestFares.com, a Web travel site.

next Tuesday or Wednesday, 90 percent of the 48 states will have this new fare Fed up with the large disparity between prices for last-minute fares on large U.S. airlines and those booked further in ad- vance, corporate travelers have in recent years increasingly relied upon online booking, videoconferences and budget airlines to de- crease the ir rave spending. On shorter trips, some now drive or take public trans- portation to avoid the inconveniences as- sociated with flying since airport security measures were increased after the ter- rorist attacks on Sept. 11, 2001. The announcement by Delta, the No.

3 U.S. carrier, on Wednesday to over- COST-CUTTING MEASURES Recent developments in the strug- gling airline efforts to cut labor costs: CONTINENTAL Said Thursday it must achieve its goal of cutting about $500 million in labor costs by Feb. 28. As of Dec. 16, the company had cut costs by $70 million with concessions from employees in reservations, food service, clerical and other groups.

Executives are taking salary and bonus cuts of 20 percent to 25 percent. UNITED Filed an emergency motion in bank- ruptcy court Wednesday that would temporarily cut wages by 11.5 percent for baggage handlers, ramp workers and public-contact workers. On Thursday, pilots agreed to a five- year deal that includes wage cuts, elim- ination of traditional pensions and fu- ture financial considerations. US AIRWAYS A bankruptcy judge canceled a con- tract between the airline and one of its unions. This cancellation could result in pay cuts from 6 percent to 35 percent and the loss of thousands of union jobs for an expected savings of $270 million.

The judge also approved a request to terminate three pension plans that would free the airline of nearly $1 billion in costs from 2005 through 2009. US Airways, United, Northwest and Continental copy lead in markets where they compete directly. Belk set to buy four stores from Saks Troubles pile up for workers at airlines SEE FARES, PAGE 2D SEE LABOR, PAGE 2D INSIDE TRIANGLE: Some RDU fares fall more than 40 percent. 2D BY JONATHAN B. COX STAFF WRITER Motricity, a Durham company making big strides in the mobile- phone industry, has bolstered its executive ranks as it readies for the next stage of its growth.

The company said Thursday that it has hired Matthew Petzold to serve as its first chief financial officer. a sign that Motricity, which has raised $50 million in funding, could be preparing for a significant event such as a public offering of stock or a sale. Petzold, 39, has a history of leading a company from its early stages to larger success. From 1995 to 2000, he worked for UUnet Technologies, rising to CFO of the Northern Virginia company that transmits Internet traffic around the world. While he was there, UUnet grew from about 130 workers to thousands and went public.

UUnet now is a division of MCI. Wooing an executive played in the big leagues on a na- tional, if not a global, level and is now taking his game to a young company in RTP is a nice state- ment about the company and a nice statement about the said Steve Nelson, general partner of Durham-based Wakefield Group, an investor in Motricity. The company a guy been through terrific growth and a nice success he said. Motricity itself has logged big gains in the past year. The com- pany represents the evolution of Pinpoint Networks, a local com- pany founded by two teenagers to deliver content such as ring- tones and games to consumers.

Pinpoint merged with Power By Hand of Nashville, in March. By October, the new com- SEE MOTRICITY, PAGE 3D BY DAVID RANII STAFF WRITER St. College is close to striking a deal that would help its low-power community TV sta- tion reach a larger audience. But the move also would exclude some current viewers. The Raleigh school has negoti- ated an agreement in principle with Time Warner regional division to move WAUG-TV 68 to the digital cable ser- vice, which costs more.

WAUG- TV currently is available on Chan- nel 20 only to Raleigh-area subscribers of the cable channel. Moving to a digital channel would increase the ex- posure by making it available to ime Warner subsc ibe throughout 16 counties in central North Carolina, including Durham and Orange counties. St. was the first his- torically black college in the nation to own a commercial television and radio stations. Today, the local pro- gramming is limited to broad- casts of religious services and a 30-minute program produced by students called Our But the college also in- tends to expand into airing courses that off-campus students could take and earn college credit.

Extending the reach to SEE WAUG-TV, PAGE 3D It will close two stores, expand into other two.