Let's take a breath and look at the progress of Companions through the history of Morrowind. Sherman, start the Way Back Machine!

Companion AI has been improved DRAMATICALLY lately through scripting. I think I have almost every companion mod ever written stashed in a folder on my hard drive, and when preparing Hippolyta I had gone through all of them in the editor. Looking at them in order you'll find a fascinating progression of steadily improving AI.

A Brief History of Companions:

In the beginning was Rukinea's companion mod featuring a Redguard fighter named Ulfgood Romra. Pretty basic AI, but again this was the very dawn of companions, and in one way or another all others are descended from that one. Patsy was another early one.

Along the way came some fascinating sidelines: Lord Grim, an ancestor ghost companion tied into the Morrowind main story line. He featured Guild Guide style travel abilities, meaning your companions (even from other mods) could teleport with you to 4 pre-determined locations. This helps alot with keeping a party together, especially considering the primative companion following abilities of the time. There was also the Construct mod, where you gained an animated suit of armor as a companion.

There was JB's "Children of the Night" mod with Ariela. And of course, Ariela had a personality!

Pack Guar (and the Beast of Burden series) appeared, where you got a big, strong guar to haul your stuff around. It could carry a lot, but a guar is a damn big brute to navigate through cities and so pathing was a problem. It used Barter as a workaround for the lack of a share function. Unfortunately the code (while very ingenious) caused lag and several reports of problems with transferring high-value items. The latter would be fixed in later versions, but the former was unavoidable with this system, and was only resolved with Tribunal (much later). At the time, however, no one else could touch this, and it was a must-have mod.

UlfGeir's landmark companion Slave Warrior Jessica set the new standard for companions in its day (remember, Tribunal still would not exist for quite a while). You could order her to change clothes and wear individual pieces of her armor. She repaired her own weapon automatically whenever you talked to her. She could cast Water Breathe and Water Walk on command. Jessica was by far the best companion of her day. I loved that lady a lot!

UlfGeir's "sequel", Thief Apprentice Karenna took the best facets of Jessica several steps further. Her most significant improvement was to her following ability. Her Speed and Athletics were maintained via elegant scripting at a level 100 higher than the player's, EVEN IF the player got the Boots of Blinding Speed or a similar IMMEDIATE boost. That feature was retro-fitted into Jessica, and has been (with few exceptions) a standard part of standalone companion mods to this day. Not neccesarily a feature of forced companions in quest mods, but it certainly should be. We all owe a tremendous debt of gratitude to UlfGeir!

Several others came out about this time: Lenne, Lekknat, Nyagetan, MercHall, Of Human Bondage, and others were all based on UlfGeir's work. Grumblepunk's Uvirith Unleashed included a companion you had to KILL before she would join you!

It was at this time that I began creating Hippolyta at the request of my son, whose only complaint about Jessica was not about her follwoing AI, but that he couldn't upgrade her gear. Since Tribunal was still in the future and companion share had not arrived, my only choice was to individually script support for all armor and weapons in standard Morrowind into her dialogue. And she can teach spells to (and learn spells from) the PC. [Plug] She is available on Euro-Morrowind and Emma's Elder Scrolls Site for those of you without Tribunal or Bloodmoon or who are curious. She was sent to the Summit at the same time, but has still not appeared! (Help me, Lord Xeen, you're my only hope!) [/Plug]

While I was working on Hippolyta, the next wave of companions was beginning with the magnificent work of Emma. The first and second versions of Girlfriend Breton and Boyfriend Redguard featuring Laura Craft and Indiana James (respectively) appeared. Companions began to be more than just functional cannon-fodder or hulking pack animals: thanks to Emma they were beginning to have hearts and souls. They were romantic companions for the PC. Others create automatons; she creates people! Her Witch Girl Adventure carried on this trend: JB's Ariela had spirit, but Morgana de Hex has a temper. Tick her off and she'll CURSE you! Who else does that?!

Emma also implemented the first dynamic "level up" system for companions. Previous companions levelled in a predetermined and could only go so far. Emma let the player completely control how the NPC advanced on the fly. Utterly slick!

And then came Tribunal...

Two major new features alone made this expansion worth the money for companion creators and companion users everywhere: Share, and a SetPos function capable of accepting variables.

The former function made inventory access a breeze.

The latter made possible Grumpy's brilliant Companion (Nancy) with the first major improvement in following AI since UlfGeir's mods. Those complaining about companions not following, please read carefully, because this is where it gets really good. What Grumpy did was to script a "warping" ability. If your companion gets lost, stuck, or merely falls way behind, he or she will get the PC's X, Y, and Z coordinates and teleport to the PC's location! You almost CAN'T lose them. I overencumbered Nancy (as a test) and ran all the way from Ebonheart to Balmora with her unable to walk. She followed me all the way by teleporting every few hundred yards! Grumpy also used this feature to allow companions to effectively follow you vertically while levitating. Again, this is stellar work!

Emma released updated versions of Laura, Indiana, and Morgana using this new code. A word here about Emma and her mods: her companions are always state of the art. When Rhedd and Allerleirauh released their heads, Laura and Indy got facelifts (and Indy got a race change from Redguard to Imperial, since no Redguard faces were to be released for a long time to come.) The_Other_Felix contributed some brilliant scripting to her mods, allowing companions to fight while levitating. Give them a melee weapon and start combat and they will swoop to the ground to attack! Let them use missiles or spells and they will strike from the air!

Dracandros (Dracandros' Voice), TheLys (Give Your Orders), and Cortex (Vampire Embrace) gave us all the abilities to make companions out of normal, pre-existing, they've-been-running-around-Morrowind-since-the-game-first-came-out stock NPC's. Now we can befriend (or enslave) alomst eveyrbody. Thanks to them, the WORLD is our oyster (er, kollop)!

And Brash's Morrowind4Kids gives you a whole world of new companions (Not to mention a whole new world)!

Grumpy then solved the problem of companions drowning while warping under water, by making companion Water Breathing an ability, not a spell.

And Emma again raised the bar with her Laura Craft - Adventure and Romance mod. Now you must woo your long-lost love all aver again in a series of unobtrusive mini-quests. Another step closer to humanity.

Dixon added the much-appreciated ability to tell companions to step aside when they get in your way, and his Hilda is an excellent modern companion in other respects as well!

And I recently released new versions of Hippolyta and Decius (2.01) introducing automatic spellcasting (for following using Levitating and Water Walking without explicitly ordering your companions to do so).

And now we have the ability to control companions' combat and flee options efficiently.

In summation:

1) Rukinea gave us Companions
2) UlfGeir, Grumpy, The_Other_Felix, and Dixon gave Companions brains
3) JB and Emma gave companions hearts.
4) I gave Morrowind companions an effective share workaround.
5) Dracandros, TheLys and Cortex gave companions universality.

Take your pick, there are plenty to choose from.