I don’t think there ever was a feature to follow a user on Lemmy, whether on your own instance or on another one. However, you can send direct messages to users on a different instance, and you can subscribe to communities on a different instance. In fact, you can do most actions you would do on your own instance on another instance, except for creating and moderating communities.
For example: My username probably looks like @RandomSovietKid@lemmygrad.ml
to you, indicating that my account is registered on the lemmygrad.ml instance, yet I’m seeing and commenting on this your post on the lemmy.ml instance.
If with “talk to each other”, you mean federation — yes, it’s enabled now. You can read the announcement here: https://lemmygrad.ml/post/9334. You can see posts also from the other federated instances by selecting “All” instead of “Local”.
As of 31th January, it’s restored to the Play Store. Their blog has a slightly more detailed report: https://element.io/blog/element-on-google-play-store/