Hitfix just reported that Guillermo Del Toro has officially announced that he will not longer be directing the new Hobbit films.

While this sucks beyond belief for those of us who were excited to see him work his magic on Middle Earth, it isn’t all bad news… potentially. First, he will be staying on with the film long enough to complete his work on the screenplays. Second, this frees up his hands to work on a lot of other films that we’d all love to see from him. “At The Mountains Of Madness” or “Drood,” “The Witches,” “Frankenstein,” “Hellboy 3” or “Hater” to name a few. Here is what he had to say about his departure.

“In light of ongoing delays in the setting of a start date for filming ‘The Hobbit,’ I am faced with the hardest decision of my life. After nearly two years of living, breathing and designing a world as rich as Tolkien’s Middle Earth, I must, with great regret, take leave from helming these wonderful pictures. I remain grateful to Peter, Fran and Philippa Boyens, New Line and Warner Brothers and to all my crew in New Zealand. I’ve been privileged to work in one of the greatest countries on earth with some of the best people ever in our craft and my life will be forever changed. The blessings have been plenty, but the mounting pressures of conflicting schedules have overwhelmed the time slot originally allocated for the project. Both as a co-writer and as a director, I wlsh the production nothing but the very best of luck and I will be first in line to see the finished product. I remain an ally to it and its makers, present and future, and fully support a smooth transition to a new director.”

Additionally, here’s what Peter Jackson had to say to the big LOTR fan site, One ring:

“We feel very sad to see Guillermo leave the Hobbit, but he has kept us fully in the loop and we understand how the protracted development time on these two films, due to reasons beyond anyone’s control – has compromised his commitment to other long term projects. The bottom line is that Guillermo just didn’t feel he could commit six years to living in New Zealand, exclusively making these films, when his original commitment was for three years. Guillermo is one of the most remarkable creative spirits I’ve ever encountered and it has been a complete joy working with him. Guillermo’s strong vision is engrained into the scripts and designs of these two films, which are extremely fortunate to be blessed with his creative DNA. Guillermo is co-writing the Hobbit screenplays with Philippa Boyens, Fran Walsh and myself, and happily our writing partnership will continue for several more months, until the scripts are fine tuned and polished. New Line and Warner Bros will sit down with us this week, to ensure a smooth and uneventful transition, as we secure a new director for ‘The Hobbit.’ We do not anticipate any delay or disruption to ongoing pre-production work.”

The folks at Hitfix do make an extremely strong point about the whole issue:

One thing’s for sure: MGM is now the studio that chased Sam Mendes off a James Bond film and Guillermo Del Toro off “The Hobbit.” So if you’re a financing entity wondering if you should back the studio, analyze those decisions and ask yourself if that sounds like a company worth backing.