To be GOTY, it has to win the most GOTY awards from all the major publications. BioShock and Portal won most of them last year.
Gears 2 looks absolutely gorgeous at the moment, more so than Gears 1, and all points to the story being much more deeper and characters with much more personality. Top that with the gameplay and multiplayer, theres no reason this cant be a contender for GOTY 2008 alongside GTA4 and MGS4.