Like I preached elsewhere: the main reason behind the large AI's not succeeding is the army limit/imperium.
A 3 region AI can field 3 armies.
3 minor AI's each controlling 1 region can field 9 armies.
So, in terms of military strength: 3 region AI < 3 minor AI's, by far...
This ratio becomes worse as the larger AI grows.
p.s. I personally feel, the imperium is a great tool to reign in the player. It is a bad idea for AI empire forming.
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