Lotro went the cash shop way which means more money by promoting the "Free" part of nothing you get. It has no point what so ever to do with keeping up with WOW.
You can still pay per month to play LOTRO by the way.
Of course it does, to entice newer possible paying customers to the game they had to do something radical, and allow to be free to play.
MMO's have one thing in mind when released to grab a chunk of the market away from Blizzard who are dominating the MMO market. That is fact.
But they always fail on one deciding feature that WoW has, its addictiveness, a MMO may have the best Graphics, Sound and Gameplay but if it is not addictive, people will always return back to WoW.
But, saying that Blizzard has started to ruin WoW and it is becoming a bore, Cataclysm will be Blizzards last gasp attempt of keeping control. They will always have the Lore buffs who will continue to play but casual gamers may soon get bored again and try something else, until they realise they miss WoW and go back again.
If the future Star Wars and Stargate MMO's live up to expectations those 2 combined may hit Blizzard hard and grab the fans of both from Blizzard's grasp finally.