Kenny - Yes, I agree! The cleaning performance isn't the issue, it's the design of the product. Yet they have their hands tied behind their back a bit because they also can't deviate from the design too much.
Eric - Yes, they could improve the fan or brushroll. But the carpet cleaning performance is already excellent. That's not the issue. The issue here is making the Kirby convenient to use and fit into today's modern homes and consumer's lifestyles.
I think the answer could lie in the Royal design. Eliminate the flat belt and center motor pulley, make a powerhead with the motor on top or behind the brushroll housing, with a geared belt. Or, possibly incorporate a design like the Kenmore/Panasonic Direct Drive brushroll with the motor in the middle. Replace the belt lifter assembly with a metal cap that removes to insert and remove the hose for above the floor cleaning. On the front of the handle, design a tool caddy to hold a dusting/crevice/upholstery tool, and on the back incorporate a stretch hose. And then a additional long hose and tool caddy like they do now for those consumers that prefer a non stretch hose. As for the machine's filtration, if they made the motor vent on the side by the height adjustment a little bit bigger & incorporated a Miele AirClean cloth microfibre type material to capture carbon dust from the motor, and if they either improved the outer bag material for added filtration, or made a hard case outer shell with a HEPA Filter for the bag, that would improve & modernize the Kirby's filtration. As for improving the floor cleaning, perhaps narrow the brushroll cavity a little bit, put a brushroll on/off switch somewhere on the powerhead, and change the powerhead baseplate to plastic or put some kind of soft touch material like velour or felt on it, so it would allevate consumer's concerns a metal baseplate would scratch wood floors.
The prototype Kirby we saw leaked years ago was nice, but was a bit too radical from the present design to be accepted by consumers. These changes would basically be a more tame redesign like that, but still styled like a traditional Royal/Kirby design while having some modern features added in.
As for Filter Queen, they have a couple options to modernize their design. Either ditch the paper filter cones for HEPA Cloth filter cones, or even better, replace it entirely with the Optima design they came out with years ago with HEPA Cloth bags. They nearly had it right, all they would have to do is redesign the motor intake in the bag housing so the bag wouldn't get sucked into it & inhibit airflow. Also, ditch the vents on the motor housing, put a longer handle on top, and add a HEPA Filter onto the blower port to modernize filtration. And of course that junky powerhead they use now would have to go!