Recently there's been discussion in the new world announcement thread about the merits of permadeath. On one hand there's people saying that a lot of potential players are deterred by permadeath, and on the other we have people saying that high stakes PvP is what makes H&H exciting. Both arguments got merit, and I'd lean towards permadeath if I had to pick just one, but I don't have to. It's possible to have both - permadeath as it is now in non-realm areas and in contested realm areas, and reduced "death" penalty in uncontested realm areas. For the latter I'd go with Granger's idea - instead of dying you get teleported to HF with a debilitating wound that lowers all stats significantly, can't be treated and takes a couple of weeks to heal. However, I would add one exception to the no-death thing - a new "justice" permission that realm authorities can grant you and which lets you kill people inside that realm.
Now, the immediate goal is to make the game accessible to people turned off by permadeath (though "death" penalty should still sting). But what this also does is make realm borders a lot more important, as you'll want your foragers to be safe from death. So attacking and defending border cairns becomes important, hopefully generating lots of PvP. And since contested cairns don't give death immunity, this PvP would be as exciting as ever. The gist of the idea is to create three zones - inner realm as a safe zone, realm borders as PvP heavy area, and unclaimed areas as true wilderness.
What I'm hoping this does in the long term is make H&H a lot more social. Hermits would have a lot more incentive to concentrate inside realms, and more people living in the same area means more social interactions. Especially without the threat of permadeath hanging over every interaction. For the realms, getting people clustered like that would make it a lot easier to farm authority, so they would benefit too. And as the only ones with the power to kill they'd have to get a lot more involved with keeping the peace if they want to keep the authority farm going, and that should provide plenty of opportunities for interesting interactions. Also, these areas of clustered homesteads would be juicy targets for any nearby kingdom to claim, so we might see more realm vs realm for pure territorial control.