Also, this is assuming SE writes 'smart' code, which given their excuses about why they can't change X or implement Y (or even alter existing code in a timely manner) would be a very bad assumption to make...I think we might be talking about two different things and that's where our confusion comes from.
The server itself will having hundreds if not thousands of objects that it handles, where each object is a retainer, player or something. If you are writing smart code then all these objects get grouped based on their position.
So, let's say, the Mason Wards are broken now into ten sections. Each section can handle 50 retainers allowing up to 500 retainers for that entire area. But the client tells the server, "Hey, I'm in area 1", and the server now knows that 450 of those retainers are not relevant to you, only those 50 in the same area that you're in. Now the server doesn't have to work quite as hard.
And if you want to handle 1000 retainers in one ward, add another ten sections.
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