Jackson did that to save money which was important when he was shopping LoTR around trying to get one of the studios to actually make it. It's easy to forget just how much of a gamble that property was seen as being back then. Lucasfilm has no problem bankrolling it's movie projects.
And that was a passion project for Jackson so committing the time it was going to take to see those films through as the director wasn't even a question for him. To get a single director to helm a trilogy that will release even a movie per year you're looking at a good 5 year commitment and you immediately shrink the pool of directors willing to consider working on the franchise.