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Relative size comparison of social media platforms (December 2023)
(lemmy.whynotdrs.org)
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I'm not the person you asked, but I've heard an argument that goes like this: Evil Company will "embrace" something, then "extend" it in a way that only works with Evil Company's product, then "extinguish" that thing by making Evil Company's approach incompatible with it. A discussion is provided here: https://ploum.net/2023-06-23-how-to-kill-decentralised-networks.html
Yeah, but I don't know if that really applies to XMPP. Google turned on XMPP federation for seven years and then turned it off. The article basically admits that it's counterfactual to say that XMPP would have wider adoption or be more developed today if Google never did that.
I think a more significant concern would be if Meta hires away Fediverse developers, but that is separate from them just turning on federation.