Sad but true. Mind you, it is a very slow game. I just about quit when I realized how much trading it takes to build a decent army which can get destroyed in minutes. But incentives seem to work nicely in this game.
If there were rewards based on renown, you'd see more fighting throughout the game and less mega-factions. I understand you get more renown per player if you're in a small faction. Which makes sense, as big factions have 75% of their guys trading to supply the 25% that fight. If everyone suddenly became renown whores, you'd see a lot of smaller battles with kickass gear. Which is fine by me, as an hour or more is way too long for a strat battle. I'd rather have 5 half hour strat battles in a row than one hour and a half one.