Obviously, it's not easy to quantify massively multiplayer, but I think we have to consider games like Everquest and World of Warcraft paradigms of the genre. The key is that they consist mostly of persistent zones that are open to every player on the server and no other artificial population cap is imposed. While playing in these zones, you could theoretically encounter any other player on the server. Eve Online is noteworthy for allowing their entire player base to participate in one world with no separate shards, although zones within the game do have a population cap.
Instancing
The use of multiple copies of a game area, created on demand for groups of players, is known as "instancing." Instancing allows two or more groups of players to work their way through identical areas, but each is in a private copy of that area, so the separate groups will not see, or interfere, with each other. The vast majority of MMOGs employ instancing to some extent, including WoW, which uses it for Dungeons and Raids.
Aside from reducing lag, one of the biggest advantages to instancing is that it allows players to pursue portions of the game's content without interference from other players. A boss in a crowded zone could be difficult to kill simply because everyone else jumps it before you get a chance. Instancing effectively alleviates this problem, providing each group a copy of the boss to kill in their own time. It also makes it easier to put dynamic environments in an online game.
Instancing is nothing particularly new, going back at least as far as Anarchy Online, but Guild Wars is notable for making much more extensive use of it than earlier games. All areas outside of cities are limited to a single group of up to 8 players, or instanced PvP matches that can involve several groups of 8.
Guild Wars in an interesting example because, although the developer has never called it a MMORPG, it's frequently classified as a MMORPG by the media. While you can trade and form groups in well-populated cities, you're never actually playing the game with more than a handful of people. On the other hand, games like Bioware's Neverwinter Nights, which support up to 64 players on a single server, are rarely regarded as massively multiplayer.
If you've played a variety of online RPGs, you know that playing through an instance with a fixed group of players is dramatically different than playing through an open zone such as the Barrens in World of Warcraft. Being able to meet other players as you're questing and group with them on the fly is a long way from forming a group through the chat window beforehand. Being saved from a mob at the last second by a random player passing by, or being unexpectedly attacked by players from an enemy faction, for example, are things that typically cannot happen in instances. There are lots of good things to be said for instances, but they tend to detract from the massively multiplayer feel of a game.
Final Thoughts
It could be that we're not far from calling every multiplayer online game massively multiplayer. In my view, if I can't potentially engage in core gameplay with over a hundred other players, it doesn't really qualify as massive. Clearly, there are games that sit close to this line, and the next advance in technology may force me to revise my opinion. Perhaps we'll find some more precise terms in the future to describe the distinctions that become evident as you move from one type of graphical online world to another.
