A PS6 that just pushes prettier PS5 games (and doesn't adapt any of the QOL features from platforms like Steam currently missing with PS5, for example) will have a hard time selling even if there is no direct competitor anymore. Because Xbox isn't the only competition for Sony, even if other competitors are not as direct with it as Microsoft's Xbox is/has been.
And especially at $600-$700, a PS6 that can only offer prettier graphics & faster loading while missing said QOL features, with 1P games that take even longer to make and then still go to PC after a year or two (or even Day 1 potentially, as already is with GAAS), is not going to magically flourish just because Microsoft might not have a next-gen Xbox console.
In fact in that scenario new Xbox hardware that was like gaming-centric mini-PCs/NUC/tablet/laptop/handheld devices (like I speculated they could do going forward sticking with hardware while leaving traditional consoles, the caveat being those boxes would also be running Windows and price higher than consoles since they don't have to be subsidized), could probably greatly expediate PS console install decline. It'd be 1: offering something new besides just prettier graphics and, 2: have the benefit of also functioning like a PC, but with a console-style UI. Only limitation would be price (addressable with cheaper models of lower specs & less customizations) and volume (addressable with doing 3P OEM contracts for variants).
That's why I've been saying, people have to stop thinking PlayStation's only competition is Xbox consoles, because Xbox consoles that become "Xbox PCs", would end up having a lot more value by default especially if Sony's PC initiative remains unchanged or gets more aggressive over time. That's not even to mention Nintendo and Valve. So thinking a $699 PS6 that's just a PS5 with better graphics and storage speed will suddenly "do much better" without Xbox consoles to compete against, is actually rather crazy to me.