From what I've read, yes, XMPP is bad. But that's not the problem. Keeping a persistent connection to your server, while not keeping the phone processor and/or radio active, and while not being dropped by the phone company's NAT after a very short timeout, is not a simple problem. The native persistent connection (Google's, for Android, and Apple's for an iPhone) is the only one which is guaranteed to work good enough.

Federation has the problem of being harder to prevent abuse. And for systems that use the phone number as the user's identifier, like WhatsApp or Signal, it's even harder: which server is associated to an user? What to do if the user registers to more than one server? How to prevent a server from saying it has registered a user, when the user didn't do it?

And when you control the whole infrastructure, it's easier to provide a good user experience. With federation, you are depending on the quality of other's implementations.