It's an awesome concept and a great business model if the game itself can be pulled off with some quality behind it.
The model is simple...
Have a video game that utilizes a small electronic device to "unlock" parts of the game by placing the toys (characters or vehicles) on the device itself. Figures would equate to a new playable character and vehicles would equate to a new type of mini-game where the game itself utilizes said vehicle.
Maybe castles, etc. would be new zones.
The game itself could still be quite a fun game even if you purchased no other characters, etc. but the tie-in between the two is a really great idea (even if it is expensive!)
It wouldn't have to be a direct copy of Skylanders as I can think of some better ways to implement certain things or unlock certain parts but the idea alone is a fantastic way to tie both toys and a game together.