So bad that it's almost good. That's about all I can say about this one. When you understand that it was hurriedly thrown together to ensure future access to film rights, that it was never theatrically released (only screened one time), and that it was only published in 2012, it actually becomes an amusing little gem(?) in the history of Tolkien's epic saga of Middle-Earth. To be totally honest, it doesn't deviate as much from the story as did Peter Jackson's The Hobbit trilogy (and only slightly more than his The Lord of the Rings). It's well worth the quarter of an hour it takes to view it, if only to say that you did. No film adaptation of this beloved book does it justice. I grew up with the Rankin/Bass version, and it's pretty skewed as well (but Glen Yarbrough's music almost makes up for it).
The list of discrepancies between Tolkien's The Hobbit and this short are numerous, but here are some highlights:
* The Lonely Mountain is only the "Diamond Mine of Dale"
* There are no Dwarves or Elves mentioned
* The only survivors of Dale are "Torin" Oakenshield, "Princess Mika Milovana," and a lazy watchman (who is clearly not Bard, as Bard is not in the film at all)
* Gandalf serves only to send Bilbo out the door and does not join in the quest at all
* The three survivors from Dale and Bilbo make up the entire company
* The Trolls are instead called "Groans" and turn to dead trees in the sunlight
* Bilbo falls through a crevice past the Goblins, which instead are called "Grablins" (which are mentioned but do not enter into the plot in the slightest) directly to Gollum's island (only his name is "Gooloom"), where the Ring is instantly on his finger and does not make him invisible
* No Eagles, Beorn, Mirkwood Elves, or Spiders; just a quick summary of walking nearly endlessly in Mirkwook before coming to the Lonely Mountain
* The Arkenstone is fashioned into an arrowhead and shot into Smaug's heart while he sleeps by Bilbo and the Company (but they call the dragon "Slag")
* Bilbo and Princess Mika fall in love and rule over the rebuilt Dale before returning to Hobbiton (the Shire is never mentioned)
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