Not dead, the game is just considered complete for the time being.
Modding is not particularly easy and is time consuming. The "Playable Subs" mod is still in continuous development at the moment.
What the CW world needs is a vastly expanded mission editor that will allow the average gamer to compile created single missions into campaigns easily. It is possible to manually create missions giving the enemies starting positions, original course headings, speed and intent. The current mission editor doesn't allow this type of tweaking and of course does not have the ability to save, import or string together separately created missions.
To create a mission or a set of missions with all the detail needed to make a particular scenario realistic is a lot of work. Eg, placing targets of opportunity at berth in various ports, making ASW entities patrol those ports and fjords, defining and managing the actual mission targets etc
An easier way of doing all these things would allow for a much more vibrant modding community. At least with respect to scenario creation and execution.
There is little means, incentive, benefit or reward at the moment for the hours of time needed to create diverse campaigns and missions, so not many do it.
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