Fantasy MMOs tend to start with race-based newbie zones and meet up some number of levels in, thinning to a smaller number of high-level areas before expanding again at the cap (discussed previously). Games with strictly divided PvP factions get a more strongly separated version of this, as you can send your night elf to play with your dwarf friend but not your orc friend. Some games will bring everyone together sooner, others will create several paths to the level cap. Please, make an alt while we work on the expansion.
You spend years making this base content. It takes a lot of work to recreate that leveling path several times, even if you recycle content across the paths (a roc is a red vulture, sure, why not). Unless you are Cryptic, this is something like a four-year development cycle. Now that the game is live, you are expected to patch in new content every one to three months while working on bugs and balance. At least you have some half-developed content that was meant for live, maybe even an advertised feature that was not completed on time; City of Heroes/Villains gets a special prize for patching in the last 10 levels after release twice. Oh, and you likely have an expansion every year or two, and that needs to be big enough to justify selling a new box.
Making new content for each faction is time-consuming, creates balance issues, and has limited value given the number of players at the level cap in multiple factions. Or you can make the new content once and send everyone through it. You will need faction-specific details, but the more overlap you have, the less content you need to develop. Add neutral factions that deal with everyone. Add common enemies. This conveniently encourages PvP and/or cross-faction teams, depending on how you set it up.
So you have one Outland and one Northrend. Albion, Midgard, and Hibernia fought over the one big dungeon, and now their descendants in WAR do the same. Superheroes and supervillains both fight the Hamidon, the Honoree, and Romulus (CoX is odd for having the Statesman Task Force and Lord Recluse Strike Force, very different parallel content). Holiday and event content is often mirrored, with the same content slightly redecorated for the factions’ cities or low-level areas.
I don’t know that I would prefer it any other way. It sometimes feels like corner-cutting, but I do not want to need level-capped characters across multiple factions to see all the new toys, and making two sets of them means more time or more cost. I would rather have two sets of content that I can experience on my main. Although it strikes me that Blizzard has the billions of dollars and the staffing and is still producing shared content at a Blizzard pace.