There's nothing intrinsically wrong with the idea behind Friend Codes--it's their execution where things go awry. The idea is to provide a safer online gaming environment that is easy to get onto, but in many ways they have made it even more confusing.
Like others have said, they need to make Friend Codes universal. Some games, like The Conduit, allow you to add people to the specific game's Friend List that are on your console already, but it needs to be taken further.
What I would like to see them do is, even if it doesn't let you have as many communication options as Xbox Live, allow you to have your own unique username. In an effort to avoid profanity and other rude stuff in the names, they could easily just let you make your own combination of thousands of preapproved words.
I don't see any major steps being taken
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