• We're going to name the geographic features and regions of the World, and
  
  
• The distribution of the New Factions (more about them later) will be geographic, as will the critters (eg Scorpions in the Desert, Krakens in the sea etc)
  
  
• We currently have bonuses and penalties applied to unit type performance by topography (ie Cavalry are poor on mountains and great on plains) - but we will also be introducing combat and movement speed racial bonuses by biome and topography
  
  
• We will introduce pathfinding - so if you want to go from point A to point B, you will have to go around Volcano C and Swampland D (unless you *really* have to go through them).  Unit speed will fluctuate on a journey - by both biome & topography
  
  Pathfinding also enables ambushes, unit interception (whilst travelling) and waypointing
  
  
• This then enables roadbuilding, and even the charging of tolls for players who use your roads.
  
  
• Larger rivers, and all seas, lakes and oceans will (ultimately) only be crossable by boat, and this enables everything from shipbuilding and piracy, to naval warfare - and the transport of goods by water (including river barges) as a possible profession
  
  
• Biome and geographically specific map icons.  For example, instead of a "Ruined Tower" NPC square, in a Desert this might be a tomb or ziggurat.
  

• We want lots of NPC Factions, distributed around the new world map of Illyria
  
  
• We want NPC Factions and player/alliance relationships with Factions to be important to the gameworld
  
  
• We want players to have to choose between Factions; they won't be able to be friendly with everyone.
  
  But equally, players who do not wish to take part in Factions can choose to ignore them, and be - broadly - safe from being pulled into Factions, depending on where they are in the world and what they're doing (ie sending an unguarded caravan train through a faction run by Bandits might result in your caravans being lost, regardless of your wish to be involved in Factions or not)
  
  
• We want Factions to be living, breathing things - not monolithic "just there" entities, and we want their footprint on the gameworld to be organic, and to influence (and be influenced by) external events
  
  
• We want Factions and inter-Faction relationships to be able to be directly and indirectly influenced by player actions
  
  
• We want some/many factions to tie into the religions/deities concept when we introduce this
  
  
• We want each Faction to be detailed enough (including military units etc) so that it could, in time, become a player racial option
  
  Although don't expect "Dragon" to be an available player racial choice anytime soon
  

THE GNOMES

Gnomes are natural enemies with the Goblin Faction, and they're naturally friendly with the Halfling Faction and the Dwarf Mercenary Faction (Treggar's Crows), plus a few others. 

The Gnomes live generally in hilly areas, downs and fens, in the Temperate parts of the North West of Illyria.

Their general preference is dealing with Dwarven players - they often offer discounts when trading, and they dislike dealing with Orc players, often hiking up their prices for Orc customers.

The Gnomes are very dextrous with their hands, and are quick-thinking, expert engineers.

The Gnomes have a few trade hubs which they run, and these hubs are the only place where players/alliances with suitable standings can - once we have introduced crafting to the game - use the Gnomes' workshops and blueprints (located in these hubs) to craft special machinery that improves production in their towns (eg, a more efficient gearing mechanism that improves the Flourmill by +1% in a town); or an expertly constructed Siege Engine that has a higher to-hit chance.

The Gnomes have a few cities of their own, and - whilst not naturally warlike - they can certainly defend themselves admirably, especially with the use of cunning traps and mechanisms to foil an attacker's aims.  The few times they do decide to attack an especially dangerous enemy, they often hire Dwarven mercenaries to bulk up their armies.

• The Gnome cities will grow in population, and occasionally put down new cities around their Hubs
  
  
• The Gnomes will periodically send out armies to smite their worst enemies - sometimes this will be another Faction (such as the Goblins) and othertimes it might be another player or alliance who has been particularly evil to the Gnomes in the past.
  
  
• The Gnomes - if they have excess troops - might respond to another (friendly) Faction's call for help, and possibly even a player or alliance's call for help if they are sufficiently friendly
  
  
• The Gnomes will grow faster if players supply them with the goods they need to grow - base resources as well as advanced resources; and crafting components that they want. 
  
  
• The Gnomes will produce more items for sale (and demand more supplies) in their hubs as they grow larger as a Faction,  the Gnomes will produce less items for sale in their hubs when they get smited (by other Factions, or by Players/Alliances).
  
  
• The Gnomes (and all factions) will fall in and out of love/hate with other NPC Factions depending on player actions - for example, if a massive player Dwarven army smites the Gnomes back to the dark ages, then the Gnomes might dislike Dwarves and Treggar's Crows for a bit; but over time the likes and dislikes will adjust back to their default natural balance
  
  
• Players who are friendly with the Gnomes will be able to reinforce the Gnome cities and fight alongside them vs other Factions, as well as vs other Players, possibly for reward.
  
  
• Player A might buy up all the Gnomes' blueprints and unique crafting materials - and then pay Player B to smite them mercilessly (or blockade their cities, and intercept their caravans) - thereby stifling the source of the Blueprints, and making their blueprints highly valuable, whilst not personally losing "Good Standing" with the Gnomes.
  
  
• Player Alliance A (who is at war with Player Alliance B, and also friendly with the Goblins) might smite the Gnomes, because Player Alliance B trades with the Gnomes for most of their Siege Engines, and this will cut off Player Alliance B's source of weaponry.
  
  
• We are also considering introducing Faction Quests, but this is further down the line.
  

1. Caravan changes
   
   We are, essentially, introducing a whole slew of different caravan types, with different capacities, movement speeds, and to some extent "goods types" (ie there will be specific caravans for carrying living things, such as livestock and horses).
   
   This also means that we will be introducing "Volume" as an attribute for all trade goods.  Things that you carry will take up space in the caravans, and the bigger the thing, the more space it takes up in your caravan.
   
   Caravans will cost upkeep.
   
   Large caravans capable of carrying big heavy things like Cattle and Siege Blocks will be a lot slower than fast caravans that carry small things like Gold.
   
   When we introduce pathfinding (and ambush / interception) we will allow military units to be attached to caravans to provide protection.
   
   
2. Monetisation of the Economy
   
   We're moving Illyriad away from a Barter Economy (which it currently is) to a fully monetised economy.
   
   Everything will be bought and sold for in Gold.
   
   The King will take taxes, damn him to hell.
   
   
3. Trade Hubs
   
   Trade Hubs are siege-invulnerable, Faction-run cities positioned all over the map where Factions and players can buy and sell goods from each other.
   
   We're bringing in a slew of new abilities to allow players to set prices, offer discounts (or price hikes!) by player, alliance or Faction.
   
   Hubs are, however, even cooler than that, if such a thing is possible. 
   
   For example, you will be able to rent space from the Faction who owns the hub - for warehousing your own goods - and also to pay other players to transport your goods around the Kingdom.  
   
   As another example, you will also not have to transport Gold to a hub if you have a Trader unit present at the hub (and the requisite skills); you can buy directly from the Hub on the basis of a promissary note, and the King will remove the Gold directly and automatically from your town's coffer.
   
   Cumatively this will enable trading (and hauling) as two much more viable professions than they currently are.
   
   You will only be able to see the prices on offer in hubs where you have a "Trader" unit positioned, so asymmetric pricing across the world will be very prevalent, and the prices that Factions buy and sell goods at will be dictated by their current demand as well as scarcity and some "regional averaging".
   
   We may, in the fullness of time, allow alliances to set up and run their own (vulnerable/siegable) Trade Hubs in strategically important places (and collect the taxes as well).
   
   You can still trade directly from your own city, but we are removing the whole "pre-reservation of caravans".
   
   If a player wishes to buy goods from you at your city, he will need to send a caravan over to your city bearing sufficient Gold to buy the things you are selling, and he will bring back the goods that he bought.  The King's Excisemen will ensure the goods are there in the players' city and that they get loaded into the buying players' caravans when they're paid for, but they'll tax the seller for this service.
   
   Directly sending goods to another city (eg barter) will still also be possible, but the "trade" will not be "protected" by the King, as he's not getting any tax revenue from it.
   
   
4. Trade Units, Skills, Faction Standings & "Tradable Things"
   
   There will be new units - traders - who you can dispatch to hubs to conduct business on your behalf, or report back prices.
   
   All players will be able to see the prices at the single nearest hub to their city.
   
   There will be a whole slew of new trade skills which will affect your ability to sell and move your items, as well as skills to do things such as reducing your tax burden. 
   
   Faction standing will also serve to reduce (or increase) your taxation at a particular hub.  If your Faction standing is really poor, you will not be allowed to trade at that particular hub.
   
   We're allowing all current ingame items to be traded in Faction hubs - as well as units (trade, military and diplomatic).
   
   Crafted items and blueprints/recipes (when crafting is released) will also be traded in hubs, as will "Spell Scrolls".  The release of crafting will provide a *huge* opportunity for trade, especially given that many crafting components will only be found in specific geographical regions and biomes.

Obviously, the feature I am personally most excited about is "Trade v2"...

Super excited! These factions are going to add a whole new dimension to Illyriad... V. fun!

by the way, when you say that 5 tiles around us are untouched, do you mean a 5 by 5 square centered on each city or a 10 by 10 square...? 

I interpreted that as the square my city is on, and the four in each cardinal direction (north, east...)