Mr_Zombie said:
How come so few AAA games that run on UE3 look as beautiful as TERA? :O
I haven't played any MMO before but those shots are making me want to play the game now.
1) It's using Lightmass GI, hitherto unseen in all but Enslaved, Bulletstorm and maybe the odd UDK game.
2) It's Korean. So is Kingdom Under Fire. Go figure.
3) From what I understand, it was made with no small amount of technical assistance from Epic.
4) We did our best to express the feel of character skins and various materials used in real costumes by utilising features such as diffuse, normal, specular and specular power provided by the Unreal Engines standard phong shader. We tuned up the phong shader a little bit to make it express unique colour impressions for Tera Online.

5) Erm... Bluehole are just that good? Its development team includes former members of the Lineage II team: producer, lead game designer, lead programmer and art director. Kinda makes it Lineage III.
Performance is blinding, btw. As fast as any UE3 game, though I can't really comment on network code.