Only SquareEnix could have done this. Got everyone excited, stood back and watched everyone freaking out, then say "Oh by the way, it's episodic content."
Thinking about it, it does make sense to a degree, especially if the company doesn't want to give it it's full AAA attention despite what they say. I mean you can kind of tell that by the way they're not using their own engine and have outsourced much of it's development to another company. They tell us they're not wanting to cut-corners or reduce the game in anyway, so perhaps it will ultimately lead to a fully realised FFVII Remake if done this way... is what I'm hoping at least
I know they said that some content wouldn't make it, but without details it's difficult to say exactly what that means. It could mean (hopefully) it's basic things such as the Key-Card collection in Shinra Headquarters - which is gameplay determined pretty much by the 2D maps. The game is full of those types of gameplay mechanics that don't necessarily translate into a full realised 3D game. You'd have to construct another method that would suite the new environment. It could still be key-card collection, but it likely won't be what we remember. I'm hoping that's what he meant by change.
However it could be something bigger which I'm worried it will be - like say the Chocobo farm segment after you leave Midgar. Having to catch a chocobo to escape the Midgar Zolom in the swamp. Or the Wutai Tower sidequest etc. My biggest fear is that they'll do away with the world map as we know it, and give us some linear but more realistic looking replacement.
One of the key questions is, if the game is episodic, how will it transition between episodes? Say episode 1 is the entire Midgar section of the game, you level up, collect everything you can from that part and then at the end, when you're standing outside the gate and do your final save, will all of your progress be saved and carry on seamlessly to the next episode? Or will the next episode start you from a fixed level and only certain things will be saved? If SE are not careful with this it could instantly ruin everything and destroy the spirit of the original completely.
One things for certain, I won't be buying them as the episodes come out. What is the point in playing a story heavy JRPG, stopping and then waiting another 6-12 months for Episode 2? It would ruin the whole experience.