Decals - more than just cosmetics?
So in 1.1 it looks like we are going to see a serious implementation of the decal system. What we have at the moment smacks of placeholder with just the mercenary skull decal available. In 1.1 it seems there will be different decals available depending on progress, in the form of the different Pilots Federation ranks. It seems likely at some point the game will include the ability to add Federation, Alliance or Empire decals as well, and presumably this will be linked to progress - reputation or rank.
As far as I know the decals will be purely cosmetic. I am hardly ever close enough and moving slow enough to someone else to pick out icons on their hull, and so I think they will also very rarely be seen for other players: even more so than skins, displaying decals will be largely for our own benefit and our own internal narrative. What I would love to see is real, in game effects when you mount a certain decal. Specifically, what I'm thinking of is that when you scan another player, the decals they are showing affect the results of the scan. So when you scan someone with Alliance decals you not only get their commander name, but are also shown that they are affiliated with the Alliance. This could go further: there could be specific decals which are the markings of a pirate, bounty hunter, trader etc. and so when you are scanned you are identified with that role. Of course the outward image you portray may not be true. There is a history (certainly in fiction at least) of unscrupulous naval captains flying another nation's colours in order to launch a sneak attack, and this type of subterfuge could be a tactic in Elite.
I would go further still. Every minor faction in the game should have it's own decal. These could either be randomly generated by combining simple geometric shapes, or chosen from a library of 100 or so. It doesn't matter if there is duplication between factions - the image itself is rarely seen, it's just a mechanism for displaying an affiliation with that faction. So if I fly for the Workers Party of Weeaboo to the point that I am allied with them, I gain the right to display their decal and show my affiliation. Perhaps then if people attack me, they don't only get a bounty but also lose rep with the faction. This would after all make sense in game if I am allied with that faction - if you destroy me they are going to be annoyed. The fact that there is only room for 2 or 3 decals on your hull balances this a bit - if I attack you I don't risk losing rep with a massive long list of factions you happen to have worked for, just the one or two whose colours you choose to fly.
I think there is a minor issue in the game at the moment in that we all appear as 'lone wolves', with no allegiance to any power. Some may play that way, but other players are feeling a strong identification with factions minor and major, and it would be great if they had a chance to display that, in the same way that NPCs do. At the moment, much of the narratives people are building up are internalised - it would give us all a greater sense of belonging if roles and allegiances were there for the world to see.