MMOGypsy, alias Syl, has a detailed and beautiful post about why "Storytelling in MMORPGs is overrated."
Ignoring some confusion about lore, story, story telling and narrative, I completely agree with her. Actually, only a very few people disagree, which is a somehow remarkable fact. Now, what would be a good example MMORPG?
Imagine, a pure PvE MMORPG. You kill monsters / steal treasures in dark caverns, cut wood, etc. to build houses. You have an incentive to build houses next to others players’ houses. At the same time, from the North Undead attack the land.
Naturally, where they come from, the best treasure can be acquired. The Undead are controlled by a rudimentary AI occasionally supported by an employee of the game developer.
The Undead need to be fought back, they sometimes attack in waves, they attack villages and destroy houses, some kinds of Undead even loot houses. The game at this point doesn't have an end. It is an endless struggle trying to find the best treasure in the most dangerous places to build the most prestigious home/village and to fight off the Undead in a concerted effort with other players. You don’t need many scripted boss fights for this. If the Undead attack your village they do this in waves and they might attack from different directions. They focus different players or try to burn down specific houses.
Now, add some minor struggles to this world (giant termites in some local wood, dangerous trolls in some mountains to the south, a magic race of fee in the west (nobody who ventures there returns), a terribly hot desert, inhabited by strange desert folk, to the East, a dangerous underground labyrinth that connects far-away places in a confusing magical way.
Use a death penalty that prevents players from getting from A to B by dying often enough …
This game could easily be made a reality using any modern MMORPG engine. It would tell a never-ending story. And you don’t even need PvP. It would still be a very fun game with lots and lots of player-generated content.
The point is: The story in this game is not told, it is experienced.