Local media’s tipping point into oblivion — a 1-on-1 with Gordon Borrell

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Local media is still at a tipping point
In his seventh appearance on E&P Reports, Gordon Borrell didn’t mince words. Referencing his firm’s newly released 23rd Annual Local Advertising Benchmark Report, he declared, “Local media is at a tipping point — just as likely to tip into oblivion as to survive.” It’s a familiar warning, but one Borrell insists is even more urgent in 2025.

For the first time, Borrell Associates is making the comprehensive 68-page report available to the public at no cost. “If we truly want to serve the local media industry like we say we do, we’re going to get this report into the hands of many, many more people,” Borrell said. He admitted giving it away caused “a great deal of heartburn” but added that the alternative — continuing to sell it to an industry that often fails to invest in its future — was no longer justifiable.

Why most local media companies are underperforming

The data in this year’s report is sobering. According to Borrell, 85% of local media companies are capturing less than 10% of their obtainable digital advertising market. Worse yet, daily newspapers are the only legacy media segment with zero growth in digital revenue since 2020.

“Owners have focused newspaper companies more on maintaining profit margins than on being innovative and taking risks,” Borrell said. He believes this risk aversion — often incentivized by leadership — suppresses necessary investment. “There isn’t much incentive. Nobody’s handing out bonuses for doing something innovative that actually generates money.”

But the problem isn’t just lack of performance. It’s missed opportunities. “Be excited that 98.8% of the obtainable digital revenue in your market is still out there,” Borrell urged. “That’s how an entrepreneur thinks.”

A broken sales culture and a wave of invisible advertisers
One of the more surprising insights from the report is that businesses created since the pandemic are more likely to increase ad spending with traditional media — radio, TV and even newspapers. But there’s a catch: most of these businesses remain invisible to legacy sales teams.

“Sales reps are still prospecting like it’s 2005,” Borrell said. “They’re using their eyes and ears. But today’s startups may advertise in niche digital ways you’ll never see on your radar.” These new businesses — many of which emerged in 2020–2022 — don’t fit the old visibility model. And they’re not being reached.

He added, “You can give them leads and great products, but if that sales rep doesn’t know how to pick up the phone and make 30 or 40 calls a day, your strategy will fail.” The implication is stark: the problem isn’t just product — it’s discipline, accountability and focus.

The paywall paradox and shrinking digital opportunity
Borrell expressed mixed feelings as the conversation turned to the proliferation of hard paywalls. While acknowledging the logic behind charging for premium content, he believes the model is increasingly counterproductive for local news outlets.

“We have 25 years of proof that people won’t pay for most of this content,” he said. “You’re limiting your audience, turning people off, and shrinking your reach at a time when scale matters more than ever.”

Borrell also stressed the role of consumer behavior in making paywalls untenable for many outlets. “We’ve trained audiences to expect instant access. If they click a link and see ‘login or subscribe,’ they're gone. They don’t even bother logging in,” he said. “The New York Times can pull it off. They’re a global brand. But you’re not the Times. You’re a local publisher. You need reach.”

What surprised Gordon Borrell — and what disappointed him
Asked to reflect on two decades of trend-watching, Borrell didn’t hesitate. “If you told the 2001 version of me that newspapers would hold less than 4% of the total local market — including digital — I would’ve laughed in your face,” he said. “That’s what shocked and disappointed me the most.”

On the flip side, what surprised him most was the long-term viability of the “build audience first, monetize later” model. “We used to laugh at Google and Facebook — how would they make money? But they built massive audiences and then turned on the revenue engine,” Borrell said. “That’s the model local publishers need to adopt: grow reach, then turn on monetization when you have something advertisers want to be part of.”

He pointed to media groups like Connoisseur Media and Townsquare as examples of companies using this model effectively in local markets. “They’re investing in digital not as a side hustle but as the core future of their business,” he said.