Why do you say there's no need to increase block size? I don't recall seeing any such discussion in #bitcoin-dev ... the plan has been to see what miners do when this limit is reached, which has now happened.
As I said on this post here:
https://bitcointalk.org/index.php?topic=149668.0if nothing is done then transaction fees will steadily increase until small payments with Bitcoin no longer make sense and it's no longer cheaper than PayPal. Which will throttle growth and just generally make Bitcoin less attractive to everyone, ultimately reducing usage and revenues for everyone.