Well, this whole "Peter Jackson is off The Hobbit" story finally hit the trades today, arriving in Variety and The Hollywood Reporter. CNN also managed to throw something up about it too. Personally, it reminds me of some big nasty divorce battle, with MGM playing the part of the little kid who just wants the bickering to end so they can go live with Dad (played by Peter Jackson). And New Line has taken on the part of sadistic mother (note: not all mothers are sadistic, just the one in this scenario) -- a force hell-bent on keeping the luxurious home (ie: The Hobbit) all three once shared together.
Regardless, MGM still owns the distribution rights, so they will remain involved with this for now. And, like a typical kid, insist the Peter Jackson saga is not over ... yet. They remain optimistic, and I'm sure will do what they can to get mom and dad on the same page. However, like with most divorces, it's all about money -- and one can expect New Line not to budge even a tiny bit. In fact, they might already have a substitute dad in line to replace Jackson. According to Cinema Blend, they've received a few emails from different people who claim Jean-Pierre Jeunet (Amelie) is at the top of the "How the f*ck do we replace Peter Jackson?" list. Granted, this is also the guy who brought us Alien: Resurrection (why do I feel as if some major LOTR fan just threw something at their computer). Yes, these are only rumors coming from anonymous people who may or may not have a clue -- but it's certainly a start.
Perhaps we should address the question: Who do you get to replace Peter Jackson?