Among other things, yes.
The average cost of building an MMO is so much higher than a single-person, that even wehn they cut overall sound/graphic quality the costs end up being insanely over the top. I mean for a simple MMO the project typically costs between 60-100 MILLION for any studio. For a massive project like ESO with genre-redefining mechanics and this "super server" they're planning on implementing?
I'm going to estimate that that tech, on top of server cost and game maintenance, is the reason that Zeni can't push out Skyrim: the multi-player.
Basically yes, to have a successful MMO you have to cut corner that single-player games do not. And they try to cut corners where they can most easily get away with it so it hinders your gameplay in the least possible way. With stuff like graphics and sounds, we have suspension of disbelief. But imagine when you started to play, the server started crashing every 20 minutes? Or when you started to PvP, but your class and chosen trees and racial choices were intensely underpowered? That stuff can't happen in single-players or isn't really noticed, but in MMO's it's crippling to our enjoyment and thus the developer.
Basically it all comes down to maintenance and balance, and these svck money from studios.
Zenimax is being really ambitious with their project, which I respect, and I personally feel that a lot of the stuff they're implementing will be worth the trade off.