Time Warner will fold it into Warner Bros. Entertainment and Co-Chairmen and Co-CEOs Robert Shaye and Michael Lynne are out. They are, of course, talking to the studio about future business relationships. All of which had been telegraphed a few weeks ago by new TW CEO Jeff Bewkes, who wants to tighten up the movie operations. "Given the trend toward fewer movie releases, New Line and Warner Bros. will now have more complementary release slates, with New Line focusing on genres that have been its strength," he said. Nikki Finke, who was first to report on the breakup last month, expects some pain for New Line projects and personnel:

Right now, there are more questions than answers about how this is going to work precisely. Even the Warner Bros people are saying that. The short-term good news for those fearful of losing their jobs is that, as part of the consolidation, New Line will be operated as a unit of Warner Bros and maintain separate development, production, marketing, distribution and business affairs operations. Of course, how long that lasts is anybody's guess, and Bob Shaye and Michael Lynne forecast that New Line will become a much smaller company. Bewkes refused to renew their contracts. The pair co-founded the company 40 years ago and did a brilliant job creating a powerhouse studio large in profit if not size and scope.

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