The cost reduction enabled by the availability of 16nm lithography could be used in two ways, either shrink the existing design and pass the savings onto the consumer (PS4 slim model), or keep the price the same and add value (XB1 Slim and PS4 Neo).
Sony has to make pricing room for the Neo, if Neo is to be $399 (obvious price point) then PS4 can't be $349. So they've used 16nm to cut costs of the PS4 Slim, and add features (power) to the PS4 Neo. I wouldn't be surprised to see PS4 Slim at $249 and Neo at $399.
MS isn't anywhere near ready to release Scorpio, so they've bet on enticing existing users to upgrade by using the cost reduction to add value to the XB1 Slim by adding 4K Blu-ray support. Overall, both are valid strategies that will help differentiate the PS4 and XB1 from each other and potentially improve the sales of both. PS4 Slim becomes the cheap HD console, XB1 Slim becomes the media console and PS4 Neo becomes the power console until Scorpio arrives late next year.
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