It looks like they are introducing a new line. So they'll have the intro level camera(s), the xxD series, and the 7D series for APS-C, the 5D and 1Ds series for full frame, and the 1D series for APS-H.
I question how long the 7 series will survive. As processing speeds go up and fab costs come down, I'm not sure if there is a purpose to having that many APS-C price points. I suspect that over time most of the pro and serious amateur market will migrate to full frame. That's the future, though, and they needed something in that niche for today.
I'm a little surprised that the much rumored replacement for the 70-200 f/2.8 IS lens didn't materialize. On the other hand, the rumors themselves seemed odd because that lens isn't in a big need for an update. They'd be better served updating the 100-400 (or introducing a competitor to Nikon's 200-400), or producing a 24-70 f/2.8 with IS.
I'm really surprised that there hasn't been more discussion here on the new Sony. The 850 is a high res full frame camera for $2,000. It's an amazing amount of camera for the money. It's not an ideal WDW camera because high ISO shooting is it's achille's heal, but for people not needing high ISO capability, it's got awesome performance per $. They've still got a lot of work ahead of them, but I think Sony's going to be a major player in the pro market someday.
roughly:
XS-D3000 XSi-D5000 T1i-D90-50D D300-7D 5D-D3 1D-D700
Now I'm not 100% confident with the last few there as my knowledge of the top tier Nikon cameras is a bit limited but it seems to me that canon has just as many crop frame cameras as Nikon. In fact, it makes sense that they would want to compete at eachother's price point.