What would be an acceptable outcome for you?
You seem to be asking for a book here. The requested feature is just one facet of a multifaceted problem -- to diminish the centralisation problem. One specific benefit we get from this one feature is the ability to get rid of the exclusive content that pollutes the timeline. Part of living in the free world is getting the non-free world out of the way. I need a view of the free world showing only venues where I am not excluded.
Instances close because people stop running them, not because other larger instances exist.
These two reasons are intertwined in a causal relationship.
Ultimately people vote with their feet, so if you want to see more smaller instances they need to become more appealing than large ones.
That’s not the only way. The small instances are buried in litter. Clearing the litter out of the way is a much simpler and much more effective way to see the smaller instances.
Also not sure what you mean by seven instances under one corporation? Are you talking about cloudflare or are you saying they’re all run by the same entity?
All seven instances are Cloudflare-centralised. They all give CF a view of all traffic (public and private) and they all arbitrarily discriminate against the same demographics of people. If you are denied access to one of them, you are denied access to all of them. Exceptionally, programming .dev has whitelisted Tor. But that’s just one demographic; that instance still blocks all the other demographics excluded by Cloudflare’s blockade. So users are all being controlled by the same entity.
I don’t like Amazon. Why do people use it? Because it’s convenient, it has the stuff they’re looking for, and it has that stuff at low prices. If we want people to use an alternative, we won’t do it by trying to guilt them to use a more expensive and inconvenient option.
You seem to be claiming boycotts do not work, IIUC. When it became widely known that McDonalds was giving free meals to Israeli soldiers, high numbers of people gave up the convenience and pricing that attracted them to McDs. McDs is a franchise, so different shops have different owners. McDs was forced to directly buy all the shops owned by the Israli who was giving away free meals, just to cancel that policy, just to protect the McDs brand.
Of course there are always unethical consumers. Some consumers continued eating McDs non-stop. Ethical consumers have integrity, a spine/constitution, and they practice it. They should be equipped to empower their ethical choices.
To change the status quo Amazon can get hit with antitrust law and prosocial regulation
I could write a book on all the reasons to boycott Amazon. Amazon exploits legal loopholes. They are organise their business to get away with murder (legally, or without detection). If you wait for regulators to find some cause to slap them on the wrist, it’d be a pitiful demonstration of non-activism. The very first best move to make is to stop being a part of the problem yourself by not feeding Amazon. From there, there are countless other activist actions you can take without just waiting for them to somehow shoot themselves in the foot.
Be the change you want to see.
The per user cost goes down the more users there are, and the network effect means more users will go towards bigger instances. So fine, let an instance get big, but let it be democratically controlled and funded.
The best thing you can do is walk away from the instance, not feed it or participate in any way. AFAIK, none of the seven have this democratic structure. But if they did, it’s still a harmful force because you still have a centralised policy that affects a disproportionate number of people and which also keeps smaller instances small.