Sure, but then everyone moved to Facebook. The monopolist changed, but not the monopolistic market and the lack of consumer choice.

And nobody gained privacy in the process (I rather think everyone lost even more of it).

The situation currently permits only a tiny number of winning companies at a time, and the userbase is locked in even as the site becomes wildly unpopular, until some threshold of discontent is reached, and then everyone moves, and then that new site also enshittifies and the cycle repeats.

Federation is a mechanism whereby people would be able to actually choose providers as individuals and at any time, instead of having to wait years for a critical mass of upset people to build up and leave [current most popular social media site], and instead of being forced to go to [new most popular social media site].