The news comes as a surprise to many in the industry, though no one is willing to stick his or her neck out in the small world of licensing to explain why. But according to one unnamed source, the key question is why TLC is taking the programme to a younger audience so quickly.
It's a move, says the source, that goes against acknowledged licensing wisdom, "which says you should keep the age group targeted as high as possible for as long as possible to keep the products as aspirational as possible".
Extra cachet
This "wisdom is endorsed by the success of licensing properties such as South Park, which gained extra cachet with kids because of its risky, adult image and consequently saw product walking off the shelf.
TLC, however, defends the shift in strategy for this Christmas's push for the second film in the series, The Two Towers. "We are moving into more of a Harry Potter field, but the properties are still so different, says Lisa Shapiro, managing director of TLC's entertainment division.
"Lord of the Rings has a much more sophisticated audience and is not trying to compete with Harry Potter."
This year the programme sees TLC launch a boyswear range, games in association with Electronic Arts, jigsaw puzzles and chess sets. These launches, says Shapiro, are a natural response to the property gaining DVD and video release.
Warner Consumer Products, the company behind the Harry Potter programme, is sticking to last year's tactics. Warner won't comment on whether it thinks Lord of the Rings is attacking its target audience or on whether it has a counter-attack strategy planned. Instead, a spokesperson says: "We are pleased that our products are highly anticipated again this year by fans of all ages."
Shapiro argues that mums, while they weave through the busy aisles this Christmas, will know instinctively whether their child is a Harry Potter or Lord of the Rings fan. "They'll be one or the other when it comes to buying product, she says.
But other licensing experts are not convinced. Miguel de la Rocha, retail development manager for Europe at Fox Filmed Entertainment, says: "I would be wary about saying they are mutually exclusive. Last year's box results say otherwise. The two properties have a lot in common - they both originate from cult publishing and belong to the fantasy genre - but I think retailers will support one or other."
And this is where the crux lies: retailers are at the heart of successful licensing programmes. Claydon Heeley Jones Mason, the agency behind Royal Mail's Lord of the Rings stamp promotion, has adapted its programme to make it more retailer-friendly. "We've given retailers a good set of sales material, such as better display aimed at minimum disruption, says Nick Leonard, senior account manager at CHJM.
The agency has high hopes for the promotion and has no doubt it is backing the right property. "The fact that it's not a typical sequel, because all the films were shot at the same time with the same characters and production values, convinced us to go with it over Harry Potter, adds Leonard. He argues that the property stands alone as a film better than Harry Potter, which relies on the book to encourage viewers.
Warner counters this by saying its focus is on "being true to the roots of the property and evolving it into a long-term brand". Supporters of Lord of the Rings, though, see the fact that no Harry Potter film is scheduled for release next year as detrimental to the brand's development. "We've got a clear run in 2003, says Shapiro with a smile.
MY FANTASY LICENCE - THE FREEBIES
Carl Richardson marketing director, Mr Lucky Bags
Richard Pink's "Barbie meets Bob the Builder fantasy in a previous issue was great. How tempting it is to continue the "Barbie meets" theme.
"Barbie meets Sindy - what a cat fight. "Barbie meets Action Man - would it be love in the jungle? I guess we can draw the line at "Barbie meets the Osbournes", though it would make an interesting partnership.
But the main reason not to copy Richard is that he's probably already taken out the IP and is trying to sell it as a licence.
So, succumbing to the pressure to come up with a property that rivals Richard's, I've made something up.
Identifying a potentially successful licence is bit like playing charades.
Is it a film, a book, a TV show? What's the theme? Will it be the next big thing? Who is it aimed at? So for my fantasy I'm looking for something that could combine all of this and more.
Tonight, Matthew, my fantasy licence is ... The Freebies. Aired every day at prime time on "FreeBBC and "FreeITV", aimed at pre-schools, tweens, adults and pets. The story centres on Mr & Mrs "Free From Guarantee"; their wacky neighbours, the "Free From Advances"; and those pillars of the community, Mr "Free From Royalty and Ms "Free From Approval". Like any good story there are the baddies to contend with - "BOGOF and "All About Profit", shady characters from the dark side of Planet Retailer who cause havoc and mayhem in "Freebie world.
Be part of this. Don't let this opportunity pass by. Licensors, make your next licence a "Freebie".
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