this post was submitted on 10 Mar 2021
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To be honest I think that this posts kinda misses the point of federation. Federation is not really about privacy (it wouldn't make sense anyway since most of the fediverse content is entirely public).
The fediverse brings freedom to social networking, allowing us not to be dependant on a single host. The state of the fediverse is already significantly better than centralised networks in this regard. Also, the none of the hosting platforms criticised here rely on the number one factor of erosion of privacy: advertisement. I have a really hard time believing that Amazon, and other hosting providers spy on the VMs they host (outside of police investigations). It would be quite expensive and inefficient for them to extract any useful information. Unlike Facebook/Twitter host providers already have a clear business model that doesn't involve advertisement, and they have a lot to lose if it turned out that they spied on their customer's VMs.
But this topic isn't primarily about privacy. Yes privacy is also potentially effected (but as you say not that likely), but what this is mainly about is network resilience (and also censorship resistance).
Edit: Note how it wasn't even posted on the privacy community :p
If it comes to resilience, shouldn't those who manage an instance worry about having a backup to upload to another provider's server by changing the DNS record in case there are problems?
If so it is not a Fediverse problem but a problem of some administrators who naively do not follow good practices in general.