FWIW, I've implemented it for a small enterprise, and for a local/private community. Neither are the overwhelming froth of activity you see on Facebook/Twitter (as you'd expect), but they're doing well!
Quite stable, in my experience. The main "problem" is that local communities are necessarily less active than the entire world. Facebook/Twitter actively work to make sure your feed is chock full of amazing things every time you log in. Your local community Diaspora* feels quiet even if the people you want to interact with are reasonably active.
I just setup an instance myself on Heroku. Not painless, but not too bad. I am thinking of trying to get my group of friends on there as a little social experiment in having an exclusive-club sort of social network. I also own the domain hnsocial.club and was hoping to setup a Diaspora instance there, tweak the look of it, and get the HN community to hopefully use it - would help a lot with network effects if a lot of HN people were just there. But have not gotten around to it.