In blizzards case, mmo's are a huge time sink and not many have people have time to commit to multiple titles. Acquiring a competitior and maintaining it would see subscribers leave their main offering (which has been optimised for microtransactions and engagement) and splitting the player base.

They used that argument for years to avoid doing WoW Classic, and then it was wildly successful when they finally did. Seems to me like the inability to consider how they could work this into their ecosystem is yet another indicator of how far they've fallen since the golden era.