Christopher Lee is reportedly in talks to reprise his character and Ian Holm has signed on to appear as the older Bilbo. Alongside the casting announcement of Elijah Wood last week, it seems The Hobbit will be cleverly told on film as There and Back Again, the book Bilbo was writing with Wood and Holm appearing in the beginning and end of the two-part movie as a sort of narrative framing.  Well, at least that's my best guess.

Who cares, though.  This is exciting stuff!