It was more of a game design problem that created a cyclical ageing population problem. New players would buy the game, get to level 10 and realise they couldn't really get anywhere from there and then leave because it seemed like it was impossible to get anywhere without agonisingly slowly solo grinding to level 30 and then paying a merc to boost them in Abyssea (which most of them probably didn't even know was an option).
The problem wasn't that the game had a low population. The problem was that the game had an ageing population.
Now that it's very possible to get into the game as a new player, there are actually a lot of new players around in FFXI these days.
