Having played on both a faction based(Vallon zek) and FFA based(multiple emu servers), I can that there are definently pro's and con's to both.
Faction based definently helps people joining the server without a group of friends. There's a natural sense of comradery. This make people more likely to stick with the game at lower levels as they are able to make friends and get groups faster.
The cons are that it creates less targets. There's nothing worse then standing next to someone you want to kill but you can't because of the hard code. Thats usually when you see training and other douchebaggery because there's no in game mechanic to solve your conflict. To counter this on Vallon Zek, cross team guilds were formed so that we could call in guildmates to take care of these types of situations. This introduced other problems such as "Immortal healing" where a member of the same team was healing members of other teams and there was nothing you could do about it.
I'd almost say make it faction based until the level cap and then make it FFA once your hit the cap. I havent thought this all the way through however.
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