The same way iMessage siphons from SMS. You embrace-and-extend, crafting a proprietary protocol closed service with a bridge to an open one. You gain users by allowing people to inter operate with friends outside your proprietary service: normally a "cost" and impediment to your users, all the while creating incentives to onboard their friends. Once they're onboarded, they become locked in, and gradually you can reduce interoperability with the federation.
Well, I would say that applies to open protocols themselves, like SMS and XMPP - in fact Google did it also. But when two service providers interoperate and build more features to entice users to move to their platform, I would call it fair competition not siphoning; there is no "one way" aspect, you either federate or not.
What I want to say is that killing XMPP federation was a deliberate stab against a competitive market, not some reasonable defense against being taken advantage of, it's exactly the final "reduce interoperability" step you talk about. Unless competition regulators disagree, it's fair game for Google, but the consumers certainly stand to lose.
