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.
That's fine. I also think it works okay at the moment, but I'm a critical person and I think this could become a problem in the future, so I think about how it could be solved.
If I want to browse content from another small instance, I just subscribe to their communities.
I'm just not sure the average user does that. Especially casual ones.
Also I think the average user doesn't want to use third-party websites to discover new content, especially on the phone. These services just appear to me to be workarounds.