The Walking Dead developer TellTale has used the episodic release model for many years, to great effect. In a keynote speech delivered at DICE Summit 2013, CEO Dan Connors talked up the episodic formula's strengths and weaknesses.
The full keynote runs about 20 minutes, and is available below. Connors goes into specifics on the success of The Walking Dead, so if you're keen to play through the first season without spoilers, give this one a miss. The Walking Dead had a pretty good runh at DICE 2013; it picked up four awards. A second season is inbound.