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Well, of course they were. They still are. These types of shows are cheaper to make than mecha or action or anything like that which requires lots of detailed and expensive animation. They also tend to have smaller casts, so the voice acting budget can be smaller.
The plethora of "moe shows" (I really don't like using this identifier, but what can I do) are a product of the studios realizing they can get more for less this way, by chasing down hardcore otaku rather than trying to pander to a more general audience.
It's a bit weird because usually you make something less niche to make more money, but I guess it works with anime.
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