As you can tell from the title, even though it has yet to be officially stated, this new Sonic will be episodic in nature. I mean, why call it episode 1 if it wasn't going to be. In either instance though, Sonic 4 will pick up the story just after Sonic&Knucles, taking the whole story into a new arc for fans to follow and enjoy. If they still remember what was going on oh so long ago.
As of now Sonic 4 is slated to hit the download shelves on XBox Live, PSN, and WiiWare this Summer. Or at least the first chapter of the new story is. And if you want to have a great blast back to the past and small glimpse of what we will be getting this Summer, watch the clip below.