Actually, classic Who's standard WAS nothing but arcs (the only individual episode being Mission to the Unknown, unless you count 5 Docs too). People make the mistake of treating a serial as a single story, and forget the story spanned multiple episodes. Even the serial title grouping itself came later after they stopped doing individual episode titles.
Not only arc based, but classic Who is MORE arc based than what Moffat is doing.
Let's break it down.
Episodic storytelling is when everything happens in your one episode. Nice and self contained. Most studios prefer this, because people that are not already watching the series can happen on it while surfing, stick around, and follow what is going on without having to have seen anything before.
Arc storytelling is when your plot is not self contained and drawn out over multiple episodes. If you come in late, you are going to have to stick around for a while to get enough info for it to make sense to follow.
The serial format of classic Who is just that. Seasons made up of serials, which are essentially mini-arcs. If you come in on the first ep of a serial, you are good to go. If you come in on a subsequent ep, you are going to be a bit clueless because you missed the setup and what has gone on before. And yes, you have to remember what happened in previous eps from week to week to follow the serial.
However, Moffat is running a loose arc in his series. There are eps that advance the arc story, there are episodes that are standalones that have a self contained plot that has nothing to do with the arc story.
Let's take the first half of series 6... 7 episodes.
The only arc episodes are Imp Astro, Day of the Moon and Good Man. All the rest are standalones that have a main plot that has nothing to do with the main arc. You don't have to have seen the first 2 eps of the season to be able to follow and understand the standalones.
Just because they mention or bring up the Amy pregnancy thing, or the Doc's death, or the Silence... that does NOT mean it is an arc ep. Nothing was advanced.
What will be the formula for the 2nd half of the season? I expect the same... you start off by advancing the main arc (Hitler), then likely it won't be hit again until the last couple of eps of the season.
What do you get as a result? Essentially half of the eps at most arc focused, half are not. That is WAY less arc focused than classic Who.
It's one thing to criticize what is going on IN the arc story (just like in classic Who... some serials were great, some were average, some were ick) but people complaining about the arc format... that only works for those that liked the RTD era, which departed from the serial format in classic Who.