The word currently is that McKellen will be going into New Zealand in January fresh off of finishing his role up as Magneto in Bryan Singer's X-MEN. We will then be a part of the production for... ELEVEN MONTHS. The word circulating my spies in New Line and Weta is that Ian read all 3 scripts and adored the project and felt it was a great part. It also seems that New Line has been completely and totally behind the idea from the get go and were quite accomadating with allowing room for his role as Magneto
It has also been confirmed that the brilliant casting rumor of Ian Holm as Bilbo will in fact no longer be a rumor, but a reality. God this is really going to be something folks. Can't you feel that energy this project seems to radiate. We've still got soooooo long to go, and many many more parts to hear filled... but thus far I'm incredibly pleased with the casting thus far.