What happens when Paramount Pictures and Paramount Vantage combine their operations? Will we still get a ‘Babel’ or ‘There Will be Blood’? I’m not sure. They’re combining marketing, distribution and physical production. Vantage will still use their own creative development and acquisition team. It will take away a part of the unique stamp, that’s for sure. It’s purely a choice of money. Just like Time Warner ditched Picturehouse and Warner Independent last month.

Of course Warner is spinning this into something like the ‘best of both worlds.’ They say it’s “to leverage the strengths and resources of a combined talent base, while minimizing redundancies and optimizing efficiencies.” But it will also save them several million in expenses. The reason studios are shutting down independent units is because of rising budgets, marketing costs and the crowded market. It’s probably just a cycle. In a couple of years they’ll just as easily start new ones.

In a court hearing June 6, Christopher Tolkien will try to terminate the rights to ‘The Hobbit.’ The 83 year old son of J.R.R. Tolkien accuses New Line Cinema of ‘accounting chicanery,’ also known as ‘Hollywood accounting.’ He says the studio still owes his family $160 million of the $6 billion it made from the three pictures. They only received an upfront payment of $62,500, so he claims.

J.R.R. Tolkien, who thought his books were unstageable, is said to have sold the rights for a 7.5% share of profits when he had to pay a tax bill in 1969. And the Tolkien Trust, which is run by Christopher and his sister Priscilla have never been pleased with New Line Cinema’s adaptations. It’s not known how big of a threat this is for the $300 million ‘The Hobbit’ project. New Line Cinema and Time Warner declined to comment.

The people at Time Warner already laid off 450 employees when they got their hands on New Line Cinema earlier this year. And now they are shutting down two independent studios to cut even more costs.

CEO Jeff Bewkes is shutting down Picturehouse and Warner Independent Pictures to stop duplicate costs for production, marketing and distribution. You would think these studios work independently and there would be no reason for double costs, but apparently this is not how it works.

COO Alan Horn says he is still “confident the spirit of independent filmmaking will continue to have a presence at Warner Bros.” Let’s hope so, it would be a shame to totally lose two independent movie studios in one day.