It seems the Hobbit is going to made with Peter Jackson producing and Guillermo del Toro moving to New Zeland for four years to direct two movies. The second movie is going to cover the time between the Hobbit and Lord of the Rings.

When it comes to the special effects Guillermo del Toro wants to use state-of-the-art animatronics mixed with computer special effects.

http://www.theonering.net/torwp/2008/04/25/28747-guillermo-del-toro-chat...