Having looked at this in some detail, my feeling is that no federated solution can work. The reason is that the underlying architecture leaks through to the user experience in unacceptable ways.
As soon as a user has to understand federation - at all - I believe the proposition is dead to most people. For example Diaspora's 'pods' are, I think, fatally confusing. (I think Zuckerberg realised this, which is why he donated money to Diaspora - a project he could see would fail, but might also crowd out other OS alternatives to Facebook.)
For sure, XMPP can be part of the tech solution, in fact I suspect there are really excellent open source tools to address many of the inherent issues (perhaps Apache Cassandra can be Twitter's contribution to democracy) but I think the real problem is a social one.
You need an institution that can credibly promise to provide a platform in the long run and which can also get critical mass in at least one community. I believe the critical mass might well follow if the institution is widely perceived as reliable and legitimate in the way a foundation like Wikimedia is.
I went into some more detail on this in a blogpost:
http://jimmytidey.co.uk/blog/building-a-better-twitter/