Exactly this. On Reddit, you would end up with stuff like r/TrueStarWars and such as a result of bad mods moderating badly — but those communities would have a harder time taking off due to the name being less searchable, and individuals needing to be “in the know” about why one sub has “true” out the front.

With everyone being able to take the same community name, just across different instances, there’s a potential for a better, more competitive process to take place instead. It won’t be perfect — @starwars is going to be in a much more immediately advantaged position than, say, @starwars — but in theory the playing field is closer to being level.