What is the purpose of the Russian letter "ь" (мягкий знак; myahkiy znak)?

The letter "ь" is very important in the Russian language. Its purpose is to make the pronunciation of the preceding consonant soft. To illustrate, look at the Russian word "конь" (horse). The "н" is followed by "ь", which means that "н" is not pronounced in its usual hard form but instead takes on a soft pronunciation (kon' instead if kon).(Audio and/or video material will accompany this question).