Didn't George himself basically admit he only had one movie's worth of material for the entire PT and that he saved most of it for Episode III?

Anyway, I actually kind of see the argument for making The Hobbit into three films. PJ had the disadvantage of having already made LotR. He'd wanted to make The Hobbit first but the film rights weren't available at the time. So now The Hobbit is following the massive success of LotR instead of preceding it, so it now needs to "live up" to the originals.