A phased approach that was planned from the beginning would have worked, but a phased opening planned late in the game doesn't work when you are not the general contractor. The old delivery method would have had TTC as the general contractor paying for all the little pieces of work contracted out, and if all the pieces were done safely in an area they could decide to open that part up. Any new cost related to changes in phased opening would be evaluated and under the control of the TTC.
In the current Crosstown delivery method the whole delivery was outsourced as a fix bid and delivery hasn't gone as well as expected meaning Crosslinx probably isn't making as much as they would have hoped. No doubt, any launch of service would be used to negotiate new billings to Metrolinx and would have legal costs involved. You need to move a train through the station not fully signed off on... that is going to throw off our whole delivery plan please pay. Every single thing not to original contract and plan would be a way for the vendor to get money back or to escape the scrutiny of the team ensuring all components have been delivered to specification.