ARAC is short for All Races All Classes, it's basically used in MMOs to denote when a group or guild allows any race or class in.

In terms of TES:O we already know we have three factions of three races, and that we have faction warfare... but we know nothing yet about guild/clans and their role in the game. Many people myself included are concerned about being arbitrarily limited to only playing cooperatively with the races in your own faction.

So do we want to see the ARAC option, not just for guilds, but for the game in general? What does this mean? It means no language barriers, no enforced segregation, ability to be in parties and quest with non-faction allies, and the ability to explore each other's provinces freely.

I think the answer is obvious, but what are the implications? Does this work from a lore perspective? Does this work with what we currently know about how the end-game PvP works? Will this cause more problems than it solves (Like in Darkfall where everyone totally ignored racial motivations and every guild was an ARAC guild for convenience of recruitment.)

since the PvP is only going on in Cyrodiil (from the interview ive gathered it might actually be realy ONLY in cyrodiil wich isnt bad as it takes away ganking, while id like to be a highwayman( in a permadeath that would work) its ofthen more than just annoying to be ganked.
while im not sure as, even on PvE servers you cant play with ppl from other factions in WoW for instance, you can do that in EQ 2. so yeah it might be a thing. Id like it beeing all honest. As, when im Adventuring, im not on duty and all.

To be honest I believe that ARAC should be a possibility for clans... as that would enable the type of gameplay individuals want.

However I would like a big focus on each faction. No interaction between each of them, KoS reactions with NPCs and cities. Big RvR and PvP.
Though if a clan wants to be ARAC so be it, and they can have that option.

Disabling interaction between those factions is a great thing because that means that your character is unique as he provides something another race/faction doesnt. Like shaman and paladins back in wow. Or like how Darkies had access to shamans and shadowknights in EQ whilst lighties had druids and pallies.

It provides balance while still bringing uniqueness to races etc.

ARAC could work very well, all I'd like to add is that there are racial benefits to classes. For example, an altmer mage does a slightly higher, lets say fire spell, damage while a nord mage does a slightly higher frost spell damage. And similar benefits to warrior/rogue classes.