I just bought my 2TB Time Capsule yesterday from the Apple Store. Since the hard drive on my MacBook is only 250 GB, I wanted to use the Time Capsule also as an external hard drive to keep possibly (less important) media files on that don't necessarily need to be backed up so that they would not take up space on my hard drive.
I'm not the kind of guy who needs back-ups of back-ups and monthly back-ups, which is what Time Machine is great at. I just need less frequent back ups. Since Time Machine will take up as much space as possible on an external hard drive, it would have filled up my 2TB Time Capsule eventually leaving with me with no extra room to store additional data.
I setup the Time Capsule last night, it was definitely easy an easy process.
When the installation setup wizard asked if I wanted to use the Time Machine for backup, I selected "Not now" and continued the installation to setup the Wi-Fi network.
Then I ran the Time Machine wizard and selected the Time Capsule as the back up storage.
I let Time Machine backup to the Time Capsule overnight.
When I was searching online how to partition the Time Capsule so that it serves as both a backup and an external hard drive, I got tired of reading that "it couldn't be done" and other people saying "you have to take the hard drive out of the casing and hook it up to your Mac by USB," I decided to partake on my own adventure.
How I Partitioned Time Capsule Into an External Hard Drive
1) Start doing a backup in Time Machine so that your Time Capsule appears in Finder and/or on your desktopVery Important
2) Open Disk Utility and select your Time Capsule
3) Click on "Partition"
4) Drag the slider to decrease the size of the "Backup of yourcomputerhere" to whatever size you want to dedicate to Time Machine backups
5) Click the + arrow to add a new partition
6) Adjust the size of the partition and give it a name
7) Click "Apply"
It will take a few minutes to re-map the partitions. After that, you will be good to go!
So for all the people saying its not possible or it needs to be connected through USB... I'm guessing you're probably not a Time Capsule owner because this task was so simple!