The movie rights were going to waste and they wanted to cash in on a sure thing.

The script was awful, and his bizarre refusal to cast little people or minorities of any kind reduced the risk greatly. And at no point did Jackson make any stringent demands on the script - he changed everything and added as much nonsense as he could to sex up the violence and make the story appeal to the widest possible, lowest common denominator market. Whatever he had to do to make that money.

At no point did anyone show even the slightest integrity with regards to a faithful adaptation of the books, they pitched a low risk, dumbed down action movie that appropriated a famous author's name so it was guaranteed to cash in on the widest market possible. The script was written for teenage boys, the title was to get their parents.

Tl:dr - it was a blatant cash grab. That's literally all it was. It was just Hollywood being Hollywood. Nobody involved gave a shit if it was good, they just wanted that cash.