[cmsj]

I don't think we have enough detail about Thunderbolt 3 yet to know whether devices will be able to detect that they are connected to a USB port and not a Thunderbolt port. If they can detect that, they may well be able to choose to degrade.

It seems like an ideal way for Apple to be able to ship a display which can be connected to both thunderbolt and USB-C hosts, without the user having to care.

Obviously some Thunderbolt devices (e.g. PCI-E chassis) wouldn't reasonably be able to degrade to USB, but a good proportion of them, would.

I very much hope this is what is going to happen!

[pgeorgi]

The Type C spec also mentions a PCIe alternate mode. The main complication is to support both wrapper protocols given that thunderbolt pushes twice the bits per second over the same wire (if using active cabling)

[lsaferite]

Wrapper protocol?

The alt-mode stuff is a physical signal multiplexing, not a protocol encapsulation.