It seems to me that they have already driven the single player story (such as it was) so totally into the ground that this is actually the only direction it can go in. I'm not sure what everyone's making such a fuss about - this seems like the only sensible direction they can go in if they want to freshen up the God of War franchise - maybe even open it up to a new market.
I don't play multiplayer games, so you might expect I'd be annoyed that a traditionally single player franchise has invested in multiplayer over further single player action. However, having played all three God of War games on PS3, plus the old PSP one, I'm quite certain that the franchise needs to find a new niche. Besides, I thought people flailing at each other competitively in over-the-top ways was the heart and soul of multiplayer? ;-) God of War should fit right in...