I’ve recently tried to use peertube and I think it could improve a lot if it showed all the content in all instances. But instead you have to look around many instances to try and find something you like. Then there’s other thing, it can’t suggest content if it doesn’t know what you like and without sharing the data between the instances it doesn’t know anything about anyone. If the user data was encrypted and shared between all sites, when you log in it could use the now decrypted user data to suggest content. Or maybe it can share the data with third parties, I don’t really know.
The policy of different PeerTube instances differs greatly therefore a lot of admins decide to federate with a limited number of instances. This also has an advantage. I’m on the LinuxRocks instances and it only federates with tech oriented instances. This keeps the instance clean of a lot of unwanted content. BTW: A user can still add interesting channels to it’s PeerTube account that show up for the user only.