The design ramifications of choosing to make a game massively multiplayer are clearly not understood by designers. It's primarily a problem with the game industry as an institution. This problem becomes endemic because the only people with enough money to make a serious MMO are institutions within the game industry. Sure, there are rare exceptions, but big games need big money and big money can only be found in people who are too conservative to allow MMOs to depart far from the established conventions and norms. Too much money is at risk for innovation to take root.

I think that smaller-scale MMOs that have more rapid (and significantly less ungainly) development cycles and more realistic implementation goals can achieve a measure of success the stagnating MMO industry. If you can make a small game that does a few things very well, player will take notice. I know that if someone approaches me with a young, small, innovative game, I certainly lean towards publicizing their work and endorsing it instead of sticking with talking about the same tired stable of big business MMOs.

I wrote a longer article similar to this comment here:
http://www.thatsaterribleidea.com/2009/10/path-to-mmo-revolution.html