Still a bit on the small end IMO, but I'd be totally fine with it. It would at least be closer to being in-line with capacity vs. game size for Xbox One/PS4 base models with the 500GB HDD's.
Honestly have to wonder how much it would have driven production costs up, because it would have left them in a better position digitally, and they definitely need to bring their A game across the board on digital now that they're finally trying to catch up to what Xbox and Playstation have had for a long, long time.