You pretty much have it. Magazines on kbin and communities on Lemmy (same thing, as I understand it) are subreddits to all intents and purposes. But there are multiple ones, or similar ones, broken out all across the fediverse (which for some reason Android voice dictation wants to spell "fetaverse"; that definitely has comical possibilities!).

If you're subscribed to one of those communities, you're not connected to any of the others. So the total number of people who are interested in that topic are all split out from each other across the fediverse into relatively small groups.

You could search out the equivalent groups across the Fediverse and subscribe to each of them. But those communities and users would still be all split apart from each other. Readers of books on lemmy.ml won't see or be able to respond to posts on books on Beehaw.org unless they all go and subscribe separately to that beehaw community. So basically the whole community of interest is fractured.

Now, perhaps one of those communities will come to dominate all the others just in terms of popularity, and everyone will end up joining that one. It's possible. But I'm not sure that most instances could handle that kind of traffic. The ideal solution would be some way to merge communities of similar interest, or link them, or something. But these are early days yet, so maybe that's something that will be accomplished later.

We're not going to see massive communities like there were on Reddit for a long time, if ever. There are advantages to that, but also some big disadvantages.