There is one issue with friendly fire and that is other people. I would say a good 10% of people (going by playing many online shooters) are for want of a better description silly little boys/girls who would enjoy nothing more than to completely spoil your gaming experience by going around shooting you for no other reason than there own selfish entertainment. I would imagine (online) you would not have the option to turn it on or off as these options would have to apply to everyone. So Bungie needs to think on this as it's a bit of a game changer.
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Completely agree about the annoying little children, although it would be nice to nudge your friends after they steel your amazing, one-in-a-million assassinations!
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But then revenge kills would be so much more satisfying!