Actually they've already done this successfully. Its called Dragon Quest X, the Japan only MMO that uses Crystal Tools. The reason why it worked there was due to how much simpler the game's graphics and systems were compared to FFXIV.
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it's also important to consider what an engine actually is which is just a collection of methods and systems that drives programs. if implemented correctly, adding functionality or updating existing modules could be easy and efficient. however, if you have modules that CO depends on other moduals to much, you start running into problems where adding capabilities or making adjustments to existing ones can be difficult. if updating 1 module breaks 3 in the pipeline, it's not an efficient engine.
oh i remember these days lol. back then square had different divisions handling different functions of development and they had massive communication issues. hence the high poly flower pots. so even though there were engine issues, they had business structure issue also.
While I don't disagree the engine update improved things, which is what I'm hoping happens again you are attaching your entire belief to a bad experience with a single engine. This doesn't prove other engines can't do well at both single player and mmos just fine. But we can agree to disagree on this if it helps.
It doesn't matter how familiar Yoshi P is with XVI's engine, converting XIV to run on another engine isn't going to be an easy or cheap task.
I wouldn't hold out any hope for an engine overhaul until we hear anything from the horses mouth to suggest such a thing.
Speculating that a graphical overhaul could also come with a new engine, is quite a reach.
That said, I'm sure there's been a suggestion that XVI itself is running on a modified Luminous Engine anyway. If this is true, then it shouldn't be a stretch to more XIV over to that same modified engine, but at the same time, there's nothing there to suggest that would improve XIV all that much. MMOs and single player games work very differently.