This news got me very excited this morning. I already reserved my copy and was bummed to hear it wouldn't be online at launch, now this makes me feel better.

Still based around friend codes or can you just compete againt or play with a random person?

Definitely sold. Online guitar battles on my Wii will be bad-arse.

czott,
I imagine that if it is friend code based you could still battle random people. That is how it is on the DS. Just cuz you need a friend code for specific people doesn't mean you can't battle random players.

THat means that if a person is really good or you have a close match though you wont be able to play with them again.

Not true. In DS random battles you can play against the same person/people over and over again so long as both of the people choose to continue on. Now once you decide to stop playing yeah there's no way for you to track down the person and play them at another time, but still if you have a close match and want to play the same person you can so long as that person also chooses to play you again.

oh this became a big must buy

The only thing Friend codes theoretically limits is socializing with people you don't already know. It's not that unsensible. Everything else gaming related could be done without friend codes (this is what rivals systems are supposed to be about), but it can only be gaming related.

True it hasn't been publicized or implemented very well, but it's gaming sites like 1up that perpetuate the myth that online Nintendo gaming can ONLY be done with friend codes. And that somehow friend codes destroy gaming, kinda like how phone numbers destroy wireless communication. Oh wait... they don't.

 It would be nice if they had an "add as friend" option after matches for those people you really like playing.

 That would be absolutely great, and is almost a must have feature honestly.  Even if both people have to agree it would still be awesome.