I predicted this, but I'm having trouble tracking down my post. I've made several posts on topics pertaining to this.
In Oblivion, they had little to no object/cell occlusion culling. They had backface culling (hiding triangles on the other side of a model) and frustum culling (hiding stuff off the edges of your monitor) ... BUT without proper culling, Oblivion had serious issues even with cities in their own worldspaces. Take this for example:
- You are standing staring at a wall
- The entire city is on the other side of the wall
- Oblivion renders the entire city (within the frustum)
even though you can't see it yourself.This is because many people don't realize it but GPUs can render hidden geometry. It's just that after everything is layered up, it ends up getting covered, and this happens every frame. The reason I predicted this was that in FO3 they started to implement basic occlusion culling. A huge reason FO3 performed better. So not only does proper culling allow them to put everything into one worldspace, it also allow them to up the detail of meshes and textures because less stuff is continuously being loaded onto the GPU.
Other than GPU issues, they've probably considerably improved general scene management, streaming, and LOD-type stuff. Even FO3 was a big improvement. It may have looked a lot different than a TES game but the performance improvements were sizable.
The way that Oblivion did things is the reason a lot the mods were very intensive too. Better Cities, texture replacers, even RAEVWD has an impact (and that's why the higher detailed versions are impossible to use). I can't wait for mods to be released like high res textures and Better Cities, because they will actually be able to be run on current hardware.