Tessellation requires too much processing time to even bother putting it into an MMO. For the likes of a first-person shooter you have a smaller FoV (Field of Vision), allowing you to occlude anything not in the FoV.
Where-as in a 3rd person MMO with hundreds of mesh objects in the scene it's simply a waste.
The detail can be easily acquired from the use of normal/height/bump maps.

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