Each instance is actually an independent site running a copy of the same source code. What's different is that they are cross-linked, so if you are on one, you can interact with any others that are federated.

Note that federation isn't universal. Some instances choose not to connect to others (due to things like getting problematic users from ones with less strict review and such). I had to make a new account on here since I had been using one on Beehaw, which is a relatively stricter and more limited community, and they had unlinked lemmy.world.

So it's a bit more work to use, but you get the benefit that there is no single central authority who can dictate things. You can move to the same topic in another instance or start your own instance.