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720 is going to be much more than a game console.

It will be a media center capable of interfacing with your tablet/cell phone/PC/full social media intergration, and will have a lot of "smart TV" features and perhaps even be a replacement for your cable box/DVR entirely. You'll be able to interface with the system through a game pad, sure, but also through a much advanced version of Kinect (gestures/facial rec/voice rec) or even your cell phone/tablet if you want.

And I do think 720 will actually have Windows 8 (or at least RT) on it, full stop.

I imagine Sony may try to match some of that by putting GoogleTV onto PS4.

I think the era of the "game console" that just sits there and plays video games and not much else is basically coming to an end. Even Nintendo, with Nintendo TVii and Miiverse seems to be moving away from that concept.

The next generation will be much more about this type of intergration, not controller gimmicks so much (that idea in itself now is starting to become old hat). Even Reggie himself admitted he feels the revolutionary features of the Wii U are actually Nintendo TVii and Miiverse, not the fact that the controller has a touch screen on it (nice, but nothing earth shattering).