The studio lead game producer and designer Matt Firor said that upon login you'l get a few qeustions about your preferances and what you like most. PvP, PvE, Dungeons, Raids, Solo, small groups, crafting,... then the system (the mega server) will automaticly group you with other players who enjoy the same thing. However, I'm not sure this is a good idea. The whole idea of an MMO is not isolate yourself from players, you isolate yourself by closing a whole group of other players that happen to enjoy other aspects of the game. Admittedly at first I thought this may be a very nice feature, but I'm not so sure now.

Those preferences won't be set in stone. The Megaserver will do the opposite of isolating people. You will now have access to everyone who plays this MMO. Whereas in past game you would have to re-roll on a different server. In ESO if you want to play with a different type of player simply logout adjust your preferences and log back in.