Meaning of this message?

Please have a look at the translation hint. It should be clear.

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This message appears in the revision history of a page when comparing two versions which aren't consecutive, and the intermediate revisions have been edited by more than 100 users.

Parameters:

• $1 - the number of revisions, will always be 101 or more
• $2 - the number of users that were found, which was limited at 100

Related messages: [edit this list]

• Diff-multi-sameuser (“({{PLURAL:$1|One intermediate revision|$1 intermediate revisions}} by the same {{GENDER:$3|user}} not shown)”)
• Diff-multi-otherusers (“({{PLURAL:$1|One intermediate revision|$1 intermediate revisions}} by {{PLURAL:$2|one other user|$2 users}} not shown)”)
• Diff-multi-manyusers (“({{PLURAL:$1|One intermediate revision|$1 intermediate revisions}} by more than $2 {{PLURAL:$2|user|users}} not shown)”)

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So doesn't this mean that the PLURAL:$1 is unnecessary?

For many languages yes, but it is needed for some.