A way I have found to explain federated social media to people, that seems to work is this: Imagine reddit, but instead of one company, with one administration, owning the whole site, it is a bunch of different reddits, that are independently run, that choose which other reddits they wish to associate themselves with. When you log into one instance, you automatically can see, and interact with, all the other ones that one chooses to associate with. You can have accounts on as many instances as you would like, even having accounts on instances that do no associate with each other.
A way I have found to explain federated social media to people, that seems to work is this: Imagine reddit, but instead of one company, with one administration, owning the whole site, it is a bunch of different reddits, that are independently run, that choose which other reddits they wish to associate themselves with. When you log into one instance, you automatically can see, and interact with, all the other ones that one chooses to associate with. You can have accounts on as many instances as you would like, even having accounts on instances that do no associate with each other.