I think its the only way to not be completely dependent on some single entity.

So far we have seen all of them go bad with time. At least with federation, you and me can talk with no corporation in the middle, which brings me back to the lovely feeling of the 90's with BBS's and forums. Before the corps took over and put ads everywhere, and basically took the world hostage.

If something big happens, ordinary people need to be able to talk without censorship. And its going to be very hard to censor a distributed network like Lemmy.

I think it’s a huge advantage. It’s not that confusing that different websites share content. I think all it would take is something like “sign up for the site you like or one in your state” and for the default home pages to be All vs Local.

Does anyone know of any Game Theory-esque analysis of how late-stage Fediverse is supposed to work? What's the end game? What happens to the Fediverse with all the different kinds of players involved at this point?

Choosing an instance is no more confusing than choosing an email provider. I signed up on several right away. I figured I'd stick with the one I liked best, but since they all run the same software it makes little difference. One instance lost its domain, another is constantly being DOSed. Otherwise it's simple.