From what I could speculate (although with admittedly very little basis), yeah, disagreements between the two teams plus taxes caused the Yokohama-based I-One Co., Ltd. (with it's adult game brand called
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) to basically implode.
Two
completely unrelated Yokohama-based companies, which are absolutely, definitely, certainly not reusing I-One Co., Ltd. code and assets called
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and
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were established shortly after illusion closed shut.
Put simply, ILLGAMES took with it the developers of the anime-style games like AA, AA2, at HomeMate, HaremMate, Koikatsu, whereas ILLUMINATION took with it the developers of the more realistic games (and the VR developers) from titles like VR Kanojo, Artificial Girl, HoneySelect, AI-Shoujo and RoomGirl (and was developing a successor to VR Kanojo called... VR Kanojo).
Meaning what was one developer team split in two. Either developer now has to produce enough to survive on limited manpower, no assets (because remember, they
absolutely, definitely, certainly didn't yoink I-One Co. Ltd. assets before leaving, right, because that would be theft, hmm-hmm, indeed) and no parent company to bail them out.
Both of them have been doing recruitment drives, but I'm not sure how effective they were. So I'm not exactly surprised with the... limited quality of their output.
With that said, KK, KKS and AA2 (now 11 years old) haven't gone anywhere and are still kicking, even years on, although the new Terminal tends to make AA2U a bit more complicated to run.