When not logged into DCUO or Rift lately, I've been putting a little time into Dead Space 2. I do this only when it's light outside and when my wife's around to keep a hand on my back and a fresh diaper nearby.
Okay, not entirely seriously. But it is a really scary experience. I can't recommend it enough for those who like a little horror in their gaming. I never really got into the first title, but that's okay because the title comes packed with a "previously on Dead Space" feature that catches you up on the events of the original. No sooner does this happen than you're presented as the main character Isaac in a straight jacket and being set free because all hell has broken loose... again. You have amnesia about what's happened since the first game, and you're suddenly left to your old devices and the help of a stranger to get to safety and obtain a grasp on the situation.
The atmosphere in the game is absolutely palpable, and while it relies largely on darkness and classic horror movie techniques it works because you're the on experiencing it all through Isaac's eyes. And I couldn't help but wonder how if ever an MMO developer would make a truly horrific online experience. The problem with online gaming and horror revolves around the fact that the material in an MMO is repeated often and unless it's dynamically generated it will become expected, and not scary in the least.
But then I think of games like Valve's Left 4 Dead, and I remember that even years and hundreds of hours later that game can make me jump in my chair and panic like no other. There will be a horror MMO sooner or later. It will be interesting to see what kind of scares may be in store for World of Darkness and The Secret World. But I suspect those games are looking for a more macabre feel than fearful.
What I think has the best chance of making a truly scary MMO experience is actually Undead Labs' zombie MMO. But really, we know next to nothing about that one either. Still, as I play through Dead Space 2 and share the fear with my wife, I can't help but wonder what kind of experience a massively scary game could bring... and if it could even be done.