@pandabear: I don't know if this model has been tried before with MMO's, but the only comparison I can think of is Destiny which is kind of an MMO. You just pay for the game and you have all the content in it. But will then have to pay for any expansions that comes after it. A real free 2 play game will not have the upfront fee and will earn it's money with micro transactions often making the best gear pay for only hence the "play to win" saying.
In their live stream today they were very careful never to say "free 2 play". You could look at it as buying a regular game where you pay 60 bucks and get all the content minus future expansions.
I think some people are a little confused. It is not free 2 play as you still have to pay $60 USD for the game. There is just not a subscription required (There is still a subscription option called something like ESOplus that gives you the new currency "crowns" every month). You get all the current content and the only things you can buy with microtransactions are "crowns" used for cosmetic only items. No extra powerful armor of weapons can be bought with microtransactions. Also expansions will be available for purchase.
Source: The ESO livestream today where they took questions and clarified the announcement.