In the FAQ, they define free to play as "every game will be free to play: what this means is that there will at least be a free demo, or you’ll be able to play the entirety of the game for free but may have access to additional items, upgrades, or other features that come at a cost."

I do believe that the first part is unequivocally not free to play... Xbox Live doesn't get to call itself free to play because it offers demos for almost every game. The 2nd part is certainly the freemium model that has been heavily used (and quite successful in my eyes).

But I think it is important to clarify that the system does not only feature free-to-play games, but there are paid games that offer demos. They do mention that by all games being "free" they mean that developers will be forced to include some playable content for the user, but I just do not agree with that wording, it could be much clearer.

Having said that, this looks cool :)