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I think current generation console sales shows us that added functionality does not guarantee increasing sales.


Don't think so too. That will not help them as a game console. At least not in a really huge way. On the other hand if you are selling media players you do no need the huge numbers of consoles because you do not need game developers etc. and you can sell the machine at a profit. I am not talking about the console wars there. More about the cool technology I would like to buy. And it simply is an amazing media machine (worth the price on its own).
If it would use less power, had a DVB-C input and the recorder functionality of the PlayTV addon it would be perfect. I imagine them using some of the technology in their other products perhaps their high-end TVs. That would be amazing. Imagine a TV with this technology and a movie download store similar to the itunes store. Sony simply needs to get their act together and use the technology they have. They really should bang some heads together to make this work.