this post was submitted on 07 Jun 2023
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I cannot answer most of your questions, as I don't know.
The hosting costs are paid by the instance host. As of now, servers are community funded. This doesn't seem like a viable long term solution, as people hate paying, but hate ads. Unfortunately one of them has to be done.
DMCA is also unknown to me. I guess it would be the admins of the instance the copyrighted content is hosted on? however, given the fact there's nothing stopping an instance from being hosted in a different country, similar to pirate websites, I don't know if there's anything stopping or enforcing that stuff? I mean, from a legal standpoint. Sure, admins might not want their instance being full of piracy, but that would be more of a morality thing.
One cool thing about decentralization is the higher costs incurred to copyright trolls. No longer can they comb through a single corp platform raising the alarm on violations, they'll have to spend some effort searching wider, sometimes dealing with uncooperative admins, hydra effect within the same fed network, etc. I can see forces pulling in both directions, not sure where it'll land.
Imho hosting costs, community moderation, federation politics are the larger elephants in the room. Copyright has always been just a suggestion, the huge platforms are the exception.