The All-Feed is very important to increase the content-quality of the threadiverse and therefore, ensure its existense. However, for smaller instances, there is only limited reason to put the All-Feed prominent in their UI, because their posts will never be present there. However, if they push people toward their the Local-Feed (which they currently do), people will only stay on their instance and overall discussion quality declines.
So, to truly overcome instance protectionism, we need a new feed, in which an instance can find a good balance between showing content from other instances and its own.
I’m not entirely sure what they meant. There are three settings: All, Subscribed, Local. Instance owners have to choose which is the default for their instance. Neither is “pushing” anything.
For themed instances, it makes sense to emphasize their local feed. For generic instances, not so much. Either way, users can choose another setting anytime, or even set their own default.