I’m sure you heard about the announcement heard round Middle Earth the world yesterday: Peter Jackson has settled his differences with New Line and has come on board as executive producer of the studio’s two Lord of the Rings prequels. It wasn’t mentioned in the press release, but Jackson has decided not to direct either of the installments in New Line’s adaptation of Tolkien’s The Hobbit, though the news that he’s involved should be enough. Clearly, the studio simply needed to get some good news, any good news, out there — likely more for Time Warner shareholders than Tolkien or Jackson fans.

I wasn’t the only person to immediately assume the settlement between Jackson and New Line had something to do with the latter’s disappointment with the box office of The Golden Compass. Both bloggers and blog comments were quick to claim that, “The Golden Compass’s low box office was the best thing that could have happened for LotR fans” (said “E” on Cinematical) and pat themselves on the back, as if it was all planned: “Well done everyone for not turning up for Compass!!” (from “wildphantom07″ on AICN). The real question, then, is how much more in Jackson’s favor was the settlement? We’ll probably never know, but we can imagine. After a very bad year, New Line was possibly pretty desperate.

Of course, nobody at the studio would ever admit to such a suggestion. Entertainment Weekly has the denial:

New Line is quick to point out that The Hobbit resolution is in no way a reaction to disappointing domestic box office numbers for their most recent release, The Golden Compass, which they had hoped would launch a new franchise. “Absolutely not,” said Lynne. “This has been in the works for a while now. Golden Compass, by the way, overseas, is performing spectacularly. Obviously, we have been disappointed with its performance here, but I think overall it will do quite well.”

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