Jonah Peretti, CEO, Buzzfeed
 Photograph by Kevin Moloney/Fortune Brainstorm TECH
Photograph by Kevin Moloney — Fortune Brainstorm TECH
By Mathew Ingram
December 20, 2016

Regardless of what you think of its content or publishing strategies, BuzzFeed is one of the world’s leading new media entities, with what the company says is a total audience of more than half a billion people across multiple platforms. So it’s always interesting to hear from BuzzFeed CEO Jonah Peretti about what the future holds for media.

A memo to BuzzFeed staff that was published at Recode contains a number of interesting elements, including a previously unreleased statistic about the company’s financial health. According to Peretti’s letter, BuzzFeed’s revenue grew by more than 65% this year, which he said continues a trend of more than six years of double-digit revenue growth.

That’s a remarkable track record for a media company—let alone one based on an entirely new model of publishing, a company that initially began as a kind of research project for Peretti, a co-founder of The Huffington Post.

Earlier this year, there were reports that BuzzFeed had missed its revenue targets for 2015. The Financial Times said the company had made only $170 million instead of $250 million, and that it had “slashed its internal projections” for 2016 to $250 million from $500 million.

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These reports were denied by BuzzFeed chairman Ken Lerer, however, who said forecasts for 2016 had not changed, although he didn’t say whether the company had missed its projections for 2015.

“There’s nothing cratering in the industry. It’s better than ever,” Lerer, who is also an investor in BuzzFeed, told Recode at the time. “It’s just different. And if you want to succeed, you have to open your eyes and realize how it’s different, and take advantage of it.”

Realizing how the industry is different as a result of the Internet is the core of Peretti’s letter. The answer, in a nutshell, is that it is different because social media and the democratization of publishing allow users to play a role in the process that is unlike anything else we have seen since the earliest days of traditional media.

Peretti, who has probably spent more time trying to understand the viral spread of Internet content than just about anyone else in the world, describes this process in a series of graphs.

The first graph shows traditional publishing as a one-way exercise in which media companies distribute content to users, with zero input or feedback of any kind. A second graph representing the early days of digital publishing looks very similar, although the number of players has grown. But still, very little feedback or interaction with users.

The next phase, Peretti says, came when companies realized they could get data from their users and understand more about what they were doing, where they were coming from, etc. New media enterprises like YouTube (goog) and Netflix (nflx) realized that data gave them “a key competitive advantage,” he says.

The final revolution, he argues, came when social behavior was added to the mix. Until then, the industry was “still thinking of audiences as a collection of isolated individuals.” With social media, it became possible to see people sharing content, and to understand (or at least try to understand) why they were doing so. As Peretti puts it:

Sharing is the clearest metric for showing that media is creating a social connection between people. It is why we obsess about ‘share statements,’ or what people say when they share our content. It explains why we carefully study the exchange of value that occurs when sharing happens: What is the value for the person who shares? What is the value for the person who receives?

Understanding these new elements of publishing is critical, he argues. But it’s not really something that many media companies thought about all that carefully prior to the Internet. It was just assumed that audiences would want certain types of content, even if there was no evidence to prove it. And interaction was virtually non-existent.

There are a number of things the BuzzFeed CEO doesn’t really get into in his letter, including how the site’s revenue and profitability is changing as a result of its reliance on platforms such as Facebook (fb) for its “distributed content” strategy.

Facebook’s fake news problem is worse than it looks:

For example, it’s not clear whether the site is shifting its goals because it is devoting more time and resources to video, including a recent restructuring of the company aimed at producing more video content. The ability to make money from all that video remains a question mark, in part because Facebook’s monetization strategy is still unclear.

Peretti says one thing is clear, however: That regardless of what happens to existing media entities, or how long the process takes, the Internet will ultimately win. As he describes it:

As a company, we’ve continually made decisions embracing the internet, both because we love it and because it is the best business strategy. It will take decades for analog print and broadcast to decline, and TV will continue to be very profitable for many years, but in the long run, the internet will win. In the long run, the internet always wins.

And of what exactly does “winning” consist? Does it mean that entirely new media entities like BuzzFeed are the only hope, or is it possible for existing ones to adapt and figure out how to survive or even prosper? Peretti doesn’t say. Perhaps the answer will be in a future memo.

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