New Line Cinema, the studio that created the Lord of the Rings blockbuster franchise, will be folded into the Warner Brothers unit of Time Warner, reports the Los Angeles Times. It's a cost-cutting move and part of a trend that has seen DreamWorks swallowed by Viacom, and Miramax downsized by Disney. Founder Bob Shaye will leave the company.
Hundreds of New Line's 600 employees may lose their jobs as Time Warner seeks to slash costs and drive up the stock price. "This is a no-brainer move," said one analyst. "There's no reason to have two separate infrastructures. "The question is, why did it take so long?"