It's implicit in Blizzard's development and their statements regarding the topic that they see the progression of players and characters as a relatively straight line from leveling to Heroic raids. It's something like this: first you level to cap, then run normal dungeons, then run heroic dungeons, then LFR, then normal raids, then heroic raids. A few parallel activities are available but this is the basic form of the PvE game.
A major topic of contention nowadays is the LFR. Believing that it should be ripped out of the game altogether is unfortunately outside the realm of "respectable opinion" or what passes for such in the WoW forums. But what is the LFR? If anyone believed for a moment that it was meant to "teach players how to raid", they were thoroughly disabused of that notion over the weeks following the release of 4.3. The primary purpose of LFR is, clearly enough, allowing people to "see the content", so the development resources that went into making the raid aren't "wasted" on the minority1.
The fact that the LFR is really just a glorified loot vending machine creates a gap in the road of progression. By Blizzard's own admission, normal dungeons are going to disappear and be replaced by easy heroics2. After that, what is there to keep players improving themselves3 on the road to normal and heroic raiding? People end up with no incentive to play their class well, even more so than before. Of course, leveling could be made slower and less forgiving once more, but... heh, yeah, right. Like that's happening.
But I'm straying from the point. Suppose for a moment that there was a working progression path that took players from starting fresh all the way to heroic raiding, which is, as I see it, the way Blizzard want it to be. The choice of such a linear system probably stems from the theme park design of WoW.
Yet at the point in time when this model was conceived, there was no such thing as "casuals versus hardcores". True that WoW was possibly the beginning of it all, with its proposal of accessibility; but while mostly anyone could get into the game, there was no such silly thing as the notion that everyone was entitled to finishing BRD4 because of their hallowed $15 a month. The game was meant to draw players in and then challenge them, as per Blizzard's design philosophy of making a game accessible at the fringes but complex at the core, in order to provide lasting entertainment value.
Here we are, nearly 8 years later, and the simplistic fringe has expanded to the point where it's gobbled up most of the challenging core. The developers probably have not completely forgotten the importance of challenging players, else the game would be going downhill a lot faster than it is now. Yet they clearly place a much greater focus on extending accessibility. And it doesn't mix well with the linear progression path, as it flattens most of the difficulty curve and causes it to become exceedingly steep at the higher end.
This alienates those players who want to stay somewhere in the middle - say, someone who likes a 5-man that will test their limits but doesn't want to raid (me). It also makes players accustomed to trampling everything up to a certain point, which will result in burnout when they invariably find the first significant barrier, normal raiding. As such, it requires an increased rate of content output, but that is unlikely to be enough. Thus the model also ends up calling for the flattening of the difficulty curve further over time, which partially explains why Blizzard now assume that it's their job, not the players', to ensure progression: a lot of people have become incapable of accepting failure or even delay.
This can only end one way, if the rules of the game and players' perceptions continue on this road. And it's an ugly end, whittling away and eventually killing the significance of the "content first, accessibility later" philosophy (if it's not dead and buried already).
Some people in the forums seem to think that the next expansion pack will do away with a substantial part of the problem by implementing "sideways progression", represented by the pet battles and challenge modes. That is unlikely.
First and foremost, creating alternate meaningful development paths would imply in a major redesign of the game. The pet battles system, for example, would have to be as complex as Pokémon, or something of that magnitude, in order to have any staying power.
Second, even if there was meaningful, time-consuming progression down each and every path, they would be liable to fall to the same issue we see today in the tired old "beat bosses, get gear" model: players feeling entitled to advance but no longer able to, requiring Blizzard to change the rules in their favor.
As an aside, the pet store would inevitably bring cries of "foul!" if pet battles ever did matter. That is, if Blizzard isn't banking on boosting their pet store sales that way in the first place.
Third: besides the a priori reasons above, there isn't much reason to believe, from the information we've been given, that these new features will be anywhere near as important as traditional character progression.
I would like to believe that Blizzard are really trying to give the (apparently large) portion of the player base who feel entitled to progression, but are not really ready to work for it, something to divert their attention from PvE and allow the developers to put it back on track. But after their statement that MoP "heroics" will be more Wrath-like, and the disappointing challenge modes5, it's hard to be optimistic.
If the devs really want to diversify the game, I believe they would be better off adding branches to the traditional development path. I'd like nothing better than a couple of BRS or BRD type dungeons, with attunements and keys, tricky and hard-hitting trash, lots of quests from all over the world, simple but tightly-tuned bosses...
Sorry, daydreaming. Anyway, in a nutshell: Blizzard has their "on-rails" character development path, and it currently depends on fast content output + steady nerfs, a probably self-defeating formula largely because of evolving player expectations. The primacy of gear-based character progression is very unlikely to change, and if it changes while continuing with the current difficulty curve paradigm, it will add to the problem.
Perhaps I've got everything out of proportion, or perhaps Blizzard sees the problem and plans to tackle it slowly, so as not to upset the entitled masses. But when I try to be optimistic, things like that dreadful quote from Bashiok hang ominously above like a storm cloud.
1 There may be other reasons, too. It may be that the Blizzard fear competitors' accessible content (many of them being fresher and/or F2P), and so feel pressured to make their crown jewel, raiding, available for anyone in order to retain an edge in the subscription MMO market. Or maybe they actually believe in "democratic raiding" for its own sake... here's hoping that's not the case.
2Which strongly suggests that the only thing heroic about them will be the name. And the fact that it gives valor points.
3Notice that I'm talking about players improving their skills, not characters improving their gear.
4A mere dungeon! Today Blizzard is scared of requiring from players even so little as the trouble of forming their own groups, and God forbid they should fail to complete the instance in less than an hour.
5I plan to make a post specifically about that.