Main thing to point out here is PS4 is going to be more powerful for games than 720, which would be better suited for multitasking. Assuming that both are released at same price point, PS4 seems a better proposition for me as it will probably provide better graphics (no teething problems as no cell) at same price, but multimedia fans maybe better off with a 720.
It clearly seems both companies aren't interested in taking a heavy loss, so undercutting each other seems out of question.
So what do you find more interesting? Playing better looking games or watch a movie, listening a song and playing a games at the time (Multitasking)
No dooming please. Just state your preferences.