At present, you can move a repo between forges by cloning it locally and pushing it back up. However, you lose the issues/milestones/PR comments etc.
Federation is useful since it defines a portable standard for those things.
If you have an account on federated forge site A, you can use it to file bugs (via the forge A UI) against a project on federated forge site B.
Both websites UI will show the bug and any comments on it - data will be replicated.
In practice, there'll likely be complexities around EG moderation (particularly for larger projects making controversial decisions), replication occasionally losing data due to intermittent faults, etc. IMO those technical reasons are less likely to sink the project than inertia is; people are already using github.
I don't think inertia is really a problem. People are already using these self hosted options, and particularly in FOSS, people value the option to be independent. Maybe it won't sink github, but it will probably end the practice of people mirroring there and running their own canonical repo elsewhere.
Federation is useful since it defines a portable standard for those things.
If you have an account on federated forge site A, you can use it to file bugs (via the forge A UI) against a project on federated forge site B.
Both websites UI will show the bug and any comments on it - data will be replicated.
In practice, there'll likely be complexities around EG moderation (particularly for larger projects making controversial decisions), replication occasionally losing data due to intermittent faults, etc. IMO those technical reasons are less likely to sink the project than inertia is; people are already using github.