Before I get into other stuff, I just want to say that while it is normal for F2P games to have a sharp dropoff after the game's big release, losing 95% of its concurrent players over the course of 2 months is DEFINITELY not a normal thing for a "healthy" game. Usually the decline is 75-90% and it's over a longer period of time. And MVS still has not plateaued, it's peak on Monday was 7223 on Steam and Thursday it was 5600. So the numbers being fine now doesn't mean much because unless things change they potentially won't be in 3 or so months.
The game just isn't very good and while the support has been frequent, it hasn't really given the game what it really needs to be successful in the long-term while some of the game's systems have really started to show their faults. The whole game just feels rushed and thrown together as quickly as possible at pretty much every point. For example this is the hurtboxes that the game launched with:
Many of the game's design principles feel like they were chosen either because it superficially made it play differently from Smash, or because they didn't have time to come up with anything better. 1v1 is rough because the game's dodge is extremely powerful and costs very little to use, so unless you're highly skilled you're going to have a very hard time stringing more than one or two hits together. 2v2 fixes this a bit because you got 2 opponents you have to worry about, but still doesn't feel very good and introduces the problem of having to deal with the game's matchmaking for your teammate if you don't have a friend to play with. 3 player matches are still not possible, and 4 player FFA is a complete joke.
The game lacks the fun modes and options (as well as 8 player games) which make Smash such an excellent casual game, and the game is an imbalanced mess with no Ranked mode still, so it's not great for competitive players either. The game's been out for over two and a half months at this point, and aside from the hurtbox rework they did (which frankly just gave the characters the hurtboxes they should have had in a pre-alpha that wasn't even playable to the public) most the updates have just been balance changes (which haven't really made the game feel much more balanced) and new characters which are cool, but not really enough to keep people playing when the rest of the game is so barebones. It's got 1 new stage since launch, and the weak stagelist is one of the bigger problems with the game currently. The biggest issue though is the game's netcode, which has degraded significantly since launch and has caused some people to only get unplayably bad matches. (Before people say this is an overpopulation issue, the game ran much better at launch when there was significantly more people playing)
The game as a whole just feels like wasted potential. They had an extremely hot game idea and instead of taking their time and making it as good as possible before release with the features that it needed to last, they rushed it out as quickly as possible. And that could have been fine if WB had stepped in and given them the resources they needed to get the game up to quality as quickly as possible, but that seemingly hasn't happened either. The game is likely still going to end up stabilizing at some point where there's enough players to keep development going (Steam makes up 15-20% of the game's total population from what I can tell) so I don't think the servers are going to go down tomorrow or anything. But it should have been much more than this, there's absolutely no reason why Brawlhalla should be pulling better Steam numbers than it.
www.polygon.com
