Everything I said about what made The Muppets work, even though some feel otherwise (painfully otherwise) is what made MT not work.
Know how I always said how we really shouldn't have a Muppet program that tried too hard to be TMS? That's what I feel was the main problem with MT. It had to get a variety show format relevant years after the fact and tried to bend several genres of TV show to get it to a reasonable format. SNL, Late Show, Music shows... all together and even at best it was a hot mess. I get the reasoning behind having Clifford as the host. They wanted the hip, happening type of host (remember. Back in the early to mid-90's that was both David Letterman and Leno were actually considered "hip"), and Kermit was too much an old style small town type. Plus, they wanted to use the character less for some reason once he was recast.
Secondly, they were dealing with characters that had yet to be recast and were in semi-retirement territory. So gone was half the Electric Mayhem, Scooter, Rowlf, Link Hoghtrob, and Frank's characters were only sort of there depending on availability. So we had new characters, and just like Sesame Street at the time, only some of them actually had staying power. And we recently lost a couple of those due to Brian moving on. So to fill in their roles and their recurring skits we had pale imitations like "Deep Dish 9" and "ERERO." Both proving not to work, not to be funny, and just too pop culture relevant. Bay of Pigs Watch also sucked. However, a lot of the single serve pop culture one shots worked beautifully. Seinfeld Babies was delightful, Co-Dependants Day also good. There was a level of quality writing, just uneven and often due to the use of characters, Andy and Randy sucked after a while because they became the standard "those dumb guys." Same reason why Bebop and Rocksteady became tiresome and obnoxious midway through the 80's Turtles cartoon.
But the biggest problem was, in trying to recreate the variety show format of the Classic Muppet Show while trying to keep it hip and fresh and while trying to have new characters fill in those huge gaps, the show didn't have a voice for itself. What TMS did worked for TMS. Show were like that back then, even if it was backhanded or tongue in cheek. The writers didn't know what to do with anything until the not broadcast on broadcast television second season, where they added more sitcomy, behind the scenes elements and less focus on one celebrity guest star. Then they were canned right after a succession of actually great episodes. Had we got a third season, it would have been able to shake off what was wrong the first season and a half and become a more 1990's pop culture laugh fest with a soul instead of almost being that but being stuck with the old series in mind.
Not to mention Boy meets World was getting better ratings.