Due to the fact that airlines are "unbundling" their prices, and that unbundling is here to stay, I do not believe we will see free checked bags on the legacy airlines any time in the near future. Even elites with free checked bags still bring carryon, due to their desire to be 100% sure their bag arrives with them at the destination and their desire to save otherwise wasted time at the baggage carousel.

Non-elites who have to pay for checked bags will bring on more carryon. The probem existed before the baggage fees were invented; it is even worse now that there is an incentive for non-elites to carry their luggage on board.

My solution is two-fold. First, the airlines should get serious about enforcing the existing carryon rules at the gate. This might mean going to a "double" gate, where the passengers first go through a carryon baggage checkpoint then through the gate itself. (One sees this sort of thing in some international airports, such as LHR. There is a line to get into to the gate and a waiting area inside the gate for boarding the aircraft.) With a double gate, there would be time to identify non-conforming luggage for a gate check, and require appropriate payment from the passenger.

Second, if airlines plan to continue checked luggage fees for the indefinite future (and I see no evidence of the contrary), they should configure new aircraft to have larger overhead bins. If X% more bags are brought on board as carryon, due to the baggage check fees, then it would be really smart to plan on X% more carryon space in the overheads to accomodate the additional need.

What we have, now, is chaos. Existing airlines were designed under the assumption that the average passenger with two suitcases would be willing to check those two suitcases in the cargo hold. That assumption is no longer valid.