I don't see how federation makes economic sense for video serving/hosting. To do it economicaly you need to have local data centers with peering agreements with local ISPs and good deals for transit. Only big data companies (Google) and huge or specialized self hosts(daily motion, Facebook), can really do it.

Reddit and Vimeo were stupid for hosting video on cloud services for that reason. Reddit wouldn't have been in such an economic crunch if they weren't burning money by serving video on the cloud.