Click here to read his reasons why not.
UPDATE: Jeffrey Wells says New Line Cinema dumping Peter Jackson “is a reflection of the this year’s sea-change attitude among distributors and producers towards coddled, overpaid wunderkind types like Jackson — big-name talents who get rich deals for themselves and their production companies, after which they go off and strain or exceed the budget, and then their sometimes indulgent, overlong film (i.e., King Kong) comes out and does moderately well but not well enough. Result: the wunderkind makes out like a bandit and the studio is left holding the bag.” I think Wells definitely has a point, here.
That said, I also appreciate some of David Poland‘s points, especially: “Getting any of the actors who are loyal to Jackson and Walsh will be almost impossible.” And it would be a shame, to see anyone other than Ian McKellen play Gandalf, etc., etc.
UPPERDATE: Variety observes that New Line, which has production rights to The Hobbit, has made “a loud statement to both MGM” — which has distribution rights and has recently been playing up its desire to make the film with Jackson — “and Jackson that the studio is in the driver’s seat when it comes to ‘The Hobbit.'”