Yeah, that's about what I expected. Too soon to say that they completely changed it. And it looked like you could control other characters like Barret. It honestly didn't show enough to say for certain how it works. Materia is too important to the story to remove it from the game, so I'm certain that is still in there. It looks like there is a gauge in the corner.
Upon closer inspection, that looks like a Limit gauge. And it seems to slowly build as you attack and to deplete when you aren't. But it seems that once maxed it lets you use some Limit skill. I certainly recognized Barret's Big Shot Limit, but not Cloud's attack. So, yes, I feel confident that it is an Action type system, like in FFXV.
Color me intrigued, though not entirely happy. I wasn't really sure what I wanted from the combat. I'm a huge Final Fantasy fan (especially of VII), but I'm not so childish as to call this crap. I think it could work. Crisis Core was a solid game, for example, and I think XIII could have been okay with some minor tweaks. Looks like they may have learned some lessons, but I wanna see more before I pass my Judgement [https://www.youtube.com/watch?v=iV3KBvtgPjE].
That being said, it looks fucking beautiful. Cloud looks like he might be the classic FFVII Cloud rather than emo Cloud ("I don't care about your politics"). Graphically, it is beautiful and brings Midgar to life. The voice acting seemed okay, though the Wedge voice seemed a little off to me. And I think we saw how they might be doing the whole voice talking to Cloud moments, too. The music felt like a modern version of the classic music, and like it didn't forget it's roots.
Looks like we saw some cut scenes as well as some actual walking around. It occurs to me that the scene of them watching an explosion happens in normal gameplay. I swear I saw Cloud get pushed back slightly there.
I suspect this is an early build. Based on what news I've heard and how this all comes from very early in the game, didn't even show Tifa or Aerith, I'm expecting it will get more polish and probably be released in 2017, around the 20th anniversary.
Oh, and...