This is the answer to the oft-asked question, "Why didn't Lego build Minecraft?" Because big companies necessarily focus on risks to what they already have, while small companies focus on untapped opportunities.
This is a great point. I used to work for a large biotech firm and we agonized over decisions that small companies wouldn't even bat an eye at. When you already have several billion in sales, you worry about jeopardizing them. When you have nothing, what is there to risk?
Here the concern was that Lego would jeopardize it's brand, but they also wanted to leverage their brand to increase appeal. Were the issues you were dealing with similar, or of a different nature? Can you give any examples? I know little of the biotech buisiness, and I'm sure it'd be interesting.
"It really comes down to the brick, the core brick," is what Lego concluded. How though could the company's teams put this on a screen? Obviously, Gram says, they were inspired by Minecraft and knew that they could learn from it. "Minecraft is digital Lego," he says. "We only wish we had invented it."
And meanwhile, in an alternate universe, the people developing Game Neverending accidentally invented "Dongr", the perfect dong detection algorithm, which they sold to Yahoo for millions of dollars.
"It really comes down to the dong, the core dong," is what Yahoo concluded. How though could the company's teams keep this off the screen?"
Which is strange because there did exist a multiplayer game made by a hobbyist where you could build using Lego shaped bricks. And if I remember correctly Lego is the reason that game stopped existing.
Blockland. It's still around. I remember playing that around 2004/2005. It was really fun back then but suffered from bad performance for sizable builds.
The developer looks like he has checked out on improving the game but he is still making games and if the forums are to believe had a booth at PAX East.
Why didn't Lego just buy Minecraft, or create a similar game under a different brand? It doesn't tarnish their core product's reputation, yet they still profit off of the niche. Seems like they'd have the capital, and domain expertise to accomplish this.
Because Mojang has told them that they don't know how to build games. (Source: I know people that work at Lego and met him in person)
In general, many people prefer simple games with simple rules which they can use to build more complex systems. The reward is the appreciation of ingenuity in the application of one's imagination with the limited resources provided in the 'physical' environment (in the virtual world).
When the users are not allowed to express their ideas without mental restrictions or simply being forced to think about abiding by the rules of censorship, the imagination is being confined within artificial limits and this removes the joy of the free and innocent exploration of possibilities.
Lego enforces many rules about the play experience that hinder the creativity compared to the freedom you have in Minecraft. This is exactly what the OP has pointed out as well.
There's also something about the size of the company that tends to bring an unnecessary overhead and sluggishness into an otherwise lightweight gaming experience. The phrase "the slower it is, the more enterprise it is" is very often true in the corporate environment.
As the OP writes the moderation costs were one of the biggest expenses for the Lego Universe project. This was essentially the 'Lego Minecraft'. People loved it, but the company pulled the plug because they couldn't make enough money out of it which is their primary goal. They also wouldn't allow the fans to run their own servers or to create mods for the game (AFAIK).
There is now already a Lego theme featuring Minecraft which was released after the company realized that they've missed out big time on not buying the rights for it while it was getting popular.
