To begin, here is a description from elderscrollsonline.info of how mega server was described back in 2014 :

What is MegaServer?

Megaserver is a new scaling server technology that allows to house all players on one server but in different worlds. The main feature of the technology is flexibility. It allows to maintain the same amount of players in a particular “world”.

It is not one server. No, it is group of servers with modern hardware that work together. ZeniMax does not tell details about how Mega Server works. It is their secret and we will be able to see everything with our own eyes. Developers say that MegaServer uses all modern server technologies and innovations.

The idea sounds great but I think ZOS struggled with this and quite abandoned this functionality while having to keep only one server (still very big) to not force players to split.

The following quote makes me think the scaling technology is not working as it should.

ZOS_JessicaFolsom wrote: »

The PC-EU server is our most popular and highest population server and also has more condensed prime time hours compared to the North American servers (mostly due to time zones). Prime time is also earlier than in North America, so on launch days like today, our European players are usually the first to encounter and call out issues.

There are also game changes that makes me think that way. Remember back in the days, there were minor issues where you called for help to kill a world boss in the zone chat, a player came to help, killed the boss and you didn't see him and the boss is still alive. This was caused because those players were in different server instances. I did not see that happening for a long time. Now, it is common to see areas so overcrowded that it is not fun to play (think about Alik'r dolmens where there are so many people that boss is killed before touching the ground) and causing lag.

I don't know if ZOS removed this technology or reworked it another way so the minor issue as above doesn't happen anymore but I very much prefer this issue than overcrowded places and lag.