Though no declarations have been made, an inside source at DreamWorks tells FBLA that the company is likely to stay put with Universal for its distribution deal.

"We're actually on the Universal lot in the old Amblin studio space," the source said. "It's just easier to maintain with Universal. Paramount will still have its cut on a number of DreamWorks projects, but though nothing is set in stone, it looks like it will probably be Universal."

DreamWorks recently severed itself from the Paramount deal that had been cut by David Geffen, Steven Spielberg and Stacey Snider. Take Geffen out of that mix and you have the remaining two principals still involved with DreamWorks: Spielberg and Snider.

That pair negotiated and was awarded a $500 million deal with India's Reliance to bankroll six to eight films a year.

Those films will not be out-and-out blockbusters, but rather limited-budget pieces that can turn a profit, the source said. The example that is always given is: Sam Mendez's "American Beauty," which not only came in on a low, low budget, but won its share of awards and attention.

DreamWorks publicity reps were expectedly close-mouthed about distribution for the studio.

Stay tuned. More to come in the next week.

The Oscars, long the PBS of awards shows with no commercials, will now start allowing TV ads for movies, Variety is reporting.

The Academy Board of Governors voted to allow ads starting next year in the 81st Annual Oscars show.

The board voted to for a limited number of spots for movies that will not open until the last week of April at the earliest, according to Academy president Sid Ganis.

This means that none of the nominated film can be tubthumped during the telecast. Ads for sequels or prequels to pics in contention in the picture, documentary and animation categories will also not be allowed.

The Oscars will allow one spot per distributor, and the spot must be one that has not yet run anywhere else. Academy will not allow the use of the terms "Oscar" or "Academy Award" in the blurb.

"We've been talking about it a lot," Ganis said. "We're a celebration of movies, and here is a way to get new movies out there in addition to celebrating movies from the previous year."

Ganis would not disclose the vote tally other than to say that after the committee made its recommendation, "the gang was all for it."

"We had a good, solid, intelligent discussion among board members from every branch of the academy," he said. "And we decided we should certainly give it a try, and hopefully, with good, solid ground rules, it'll work just fine."

DreamWorks will downsize its 150-person staff by about 15% as the company gets going with its Indian cash, says Deadline Hollywood Daily.

The Reliance deal will inject some $500 million into DreamWorks coffers with an additional half bil being raised on Wall Street, though that may not be so definite these days with the current state of the economy.

As noted last week on FBLA, President of Production Adam Goodman is gone, firmly ensconced in the Paramount fold, but senior executives Holly Bario and Mark Sourian will end up as co-presidents of production at Dreamworks 2.0 with about four execs following them. DreamWorks COO Jeff Small will follow studio chief Stacey Snider.

DreamWorks publicity did not return calls to FBLA.

Raleigh Studios, the quiet, out-back Eastern Melrose Ave. studio, will open its latest configuration partnered with comic-book conglomerate Marvel Studios in Manhattan Beach.

The new location will not only employ hundreds of studio employees, handling and monitoring several soundstages and editing bays, it will shoot and produce the next four Marvel films over the next three years: "Iron Man 2," "Thor," "The First Avenger: Captain America" and "The Avengers."

Raleigh will move its Beverly Hills-based executive and production offices to Raleigh's facility in Manhattan Beach. It will mean the first major production investment in a Hollywood studio location in literally the last decade and certainly the first from the comic book realm. Inside sources have maintained that as much as $600 million could be spent on budgets for these four films, and another $300 million on marketing.

With the huge success that Paramount enjoyed with the domestic release of "Iron Man" and the international split with Sony, Universal and Universal International, it's no surprise that they were eager to work with Marvel executives to help facilitate this new studio on the block.

More information below:

continued...

In the new DreamWorks configuration relying on India's Reliance money, the former head of production, Adam Goodman, will be staying on at Paramount to help oversee as many as 40 potential DreamWorks/Paramount joint ventures, Variety says.

Much of the DreamWorks staff will be leaving the Paramount stable with principals Steven Spielberg and Stacey Snider.

Goodman won't be assigned a title of President of Production, but he will have some arbitrary executive title. Not clear whether he'll still be handling any specific DreamWorks product.

Brad Weston will continue as Paramount's President of Production. Paramount, if interested, will retain control over nearly 200 DreamWorks projects.

Gotta love DreamWorks and its ability to keep on truckin'. Most largely attribute this to the 900-pound Gorilla status that Spielberg maintains and Paramount's fervent desire to be a part of the Spielbergian universe, which includes the wildly successful "Transformers" franchise.

The new James Bond "Quantam of Solace," as all good Bond films do, will open in...where? Rather than a domestic U.S. opener or even something royally glitzy in London, the studio has decided on India for the premiere, according to Steven Zeitchik in the Hollywood Reporter.

First, it was a deal for Spielbergian financing. Now, the greatest superagent of all time will bow essentially to the East.

Fox Walden, the heavily hyped start-up that was being funded by Fox and Colorado's Anschutz company to make family pictures, is retrenching, according to Variety, after a few films like "Nim's Island" failed to perform as planned.

Jeffrey Godsick, the former Fox public relations guru, had transplanted to handle Fox Walden as the head of marketing for the new venture. Three years later, he's coming back to Fox as executive vice president of marketing and digital content.

At least 12 jobs will be eliminated amidst serious reshuffling of staff, the paper said.

Per Variety, though Fox and Walden had high hopes for the joint venture when it was created in August 2006 to market family films produced by the two companies, there weren't enough pics to warrant a stand-alone marketing entity. In the ensuing two years, only three movies have been released under the logo: "Nim's Island," "Mr. Magorium's Wonder Emporium" and "The Seeker."

Though "City of Ember" will open next week as part of the partnership, there are no films planned for release in 2009.

Walden and Fox will each continue to develop family films separately and will continue to partner as co-financiers on select projects. Among the projects they will team for are the Dwayne Johnson starrer "Tooth Fairy" and "Ramona," which is based on Beverly Cleary's bestselling kid-lit books. Both projects will be overseen by the revamped Fox Walden unit and distributed domestically by Fox.

MGM, with president Mary Parent at the helm, may be following DreamWorks down the money line to India with a deal with Reliance ADA Group, according to the New York Post.

MGM needs cash to deal with a $3.7 billion that comes due in 2012. As the studio hasn't had many hits of late, that may be a bit difficult unless they can find a Golden Goose or a just somebody with money.

Needless to say, MGM will turn into a DreamWorks wannabe if this deal comes through. DreamWorks just closed its deal with Reliance so that Steven Spielberg can keep face with an influx of more than $1 billion in production funds.

MGM had no comment on the story, but executives were reportedly headed to Bombay for a flurry of meetings.

Just kidding.

But they still need the cash.

We've been told that since circa 1991 there has not been a moment that has passed without a Police Academy movie being rerun on cable. Some cable station - somewhere has always had it on. This is not exactly scientifically verified, but like Big Foot...we believe it anyway. Besides we had a sighting - the first Police Academy was on Comedy Central yesterday. All the proof we need.

Anyway, we've not heard the name Steve Guttenburg outside of a punchline in a while. And come to find out - he's working...as an actor!

We got this press release this morning:

The horror movie features a serial killer, who targets LA convenience stores, torturing and murdering victims in creative ways -- and then stealing surveillance tapes as trophies.

In the movie, everyone is talking about the sensational series of crimes. At a downtown liquor store, a beer delivery man, MORTY (Steve Guttenberg: "Cocoon," "Police Academy," "3 Men and a Baby"), his motley friends and the store owner, STEVE (Eduardo Garcia: "No Country for Old Men"), fantasize about catching the killer -- and snagging a $500,000 reward.

"It was fun, creative and it was something I got to do that I have never done before," said Actor Steve Guttenberg, who stars as MORTY. "I'm happy to be here and make it work."

Trailer is here.

The Greater Los Angeles Area office of the Council on American-Islamic Relations has asked Warner Brothers and Warner Independent Pictures to change the title of their upcoming release Towelhead.

The trailer for the film can be found here.

It's not exactly a movie about race relations. It's secondary at best. It's about a 13 year old girl, who happens to be of a race. So, FBLA caught up with Hussam Ayloush, Executive Director of CAIR in LA and asked him why he thinks the studio chose to use that title in this market.

"The film title is based on a book with the same title." Said Ayloush. "However, the film was released in Canada under a different title: "Nothing is Private". I guess WB felt that the US market is more accepting of such language.

We think it's funny that the title for a Canadian release would get translated - interpreted into their language.

Ayloush said that although Warner Bros. executives have made it clear they intended no offense, the use of such a derogatory term by a major film studio will serve to increase its acceptability in public discourse.