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Ten2 Media

The rise of DIY music distribution platforms like TuneCore and DistroKid has been unequivocally transformative for artists — it has given them the ability to reach listeners without traditional label constraints.
Yet, while democratization has opened doors for countless artists, it’s also opened the floodgates to an equally pernicious, unintended byproduct — rampant fraud and copyright infringement. For context, Luminate reported that in 2023, over 120,000 new songs were uploaded daily, a sharp increase from 93,000 per day in 2022. The surge is predominantly due to two things: the ubiquity and growth of the DIY distribution sector and the proliferation of consumer-facing music production resources. This relatively nascent landscape has dramatically increased not only the volume of content but also the industry’s exposure to unauthorized and infringing material.

Universal Music Group’s recent $500 million lawsuit against TuneCore and its parent company Believe highlights the severity — as well as a tipping point. The lawsuit asserts that these platforms are illegally profiting from large-scale copyright infringement, where the culprit for disseminating and monetizing the unauthorized IP is both distributor and unethical user alike. Ultimately, this case highlights a broader, systemic failure, exacerbated by insufficient monitoring, accountability and safeguards for control. But the ecosystem has become too big, too unregulated and too profitable for some of its stakeholders to rectify it on their own. Reform is overdue.

Trending on Billboard

Democratized Distribution

DIY distribution was originally designed to level the playing field, allowing any artist to release music on platforms like Spotify, Apple Music and YouTube. However, open access came with side-effects — most notably, rampant IP abuse. The sector has become a breeding ground for exploitation; malicious users take advantage of the low barrier to entry by uploading pirated, remixed, or slightly modified versions of copyrighted songs. Collectively, these uploads generate significant revenue, with a portion of that going to the distributors who host them.

This is far from an isolated issue. With millions of tracks uploaded annually, there is an immense challenge in verifying every song. While some platforms claim to have anti-fraud systems in place, policing measures frequently fall short. The sheer volume of uploads makes scalable monitoring difficult, in turn creating a laissez-faire approach that indirectly allows infringement to thrive. 

YouTube Royalty Collections Unique Challenge

Nowhere is this problem more pervasive than YouTube, where scale and visibility is inherently even more challenging. Some users deliberately circumvent YouTube copyright policies by uploading and distributing pitched remixes, slowed down/sped up remixes or near-identical versions specifically in order to bypass Content ID. Detection is challenging, and most of this infringement goes unnoticed. Even when violations are flagged, recouping misappropriated payments is impossible. Artists are left to navigate an opaque, complicated system and often leave their rights exposed and earnings minimized. For many independent artists, YouTube is a key, significant revenue stream and copyright fraud siphons away that income with little recourse. 

Industry-Wide Consequences

Overvaluing volume vs. quality control creates a system ripe for exploitation because the current model often benefits the infringer. But solving the core issue mandates more than increasing lawsuits. There needs to be enforceable quality-control metrics that are clearly communicated and that actively deter fraud, while protecting rights holders. Transparent protocols to ensure flagged content will not generate income for infringers along with improved early detection systems will help standardize accountability and visibility. An enforceable and sustainable safeguard system will:

A. Prevent infringing content from reaching listeners at allB. Mandate greater transparency when infringement occurs, andC. Ensure rightful compensation for rights holders.

Closing the knowledge gap and developing industry-wide standards are also essential for meaningful change. By raising public awareness, providing a forum where artists and rights holders can report infringement and increasing pressure within the industry, the path to reform is achievable — and similar to regulations that have been implemented to curb other forms of online piracy.

A Call for Collective Responsibility

Setting clear deadlines for reform will hold platforms and distributors accountable while improving transparency. Fundamentally, and despite the challenges of volume, even en-masse DIY distributors must showcase a basic respect for IP and prioritize rights holders/artists while identifying (and deterring) the bad actors who undermine them. 

With collective, industry-wide efforts, digital music distribution can become a sustainable model that supports independent artists while upholding their rights. A system that empowers artists while maintaining integrity is essential to preserving the value of music and protecting it from exploitation.

George Karalexis is co-founder/CEO of Ten2 Media. His expertise as a media executive, strategic advisor, and serial entrepreneur spans 15-plus years across multi-sector leadership, with a focus on music, marketing strategy and tactical team building. Donna Budica is co-founder/COO of Ten2 Media. With a degree in finance from The Wharton School and an MBA from USC Marshall, she leads corporate strategy and operations at Ten2 and its subsidiaries.

Ten2 Media is a rights management and content marketing company specializing in asset monetization, audience development and content optimization on YouTube. Ten2’s expertise on YouTube and decades of experience in the music Industry is the foundation of its unique approach to maximizing revenue and marketing music for the world’s leading artists and labels.

For all the talk about TikTok and its impact on the music business, much less has been said about YouTube in the last few years. George Karalexis and Donna Budica, the co-founders and CEO and COO, respectively, of YouTube strategy company Ten2 Media, want to change that. “YouTube is so underserviced by the music industry. Traditionally, it’s just been a place to put up your music video,” Karalexis says of the platform where Justin Bieber, Troye Sivan and Maggie Rogers were discovered.
“It has evolved so much now,” Budica adds.

Trending on Billboard

With the 2021 introduction of Shorts, YouTube’s video equivalent of Instagram Reels and TikTok, the duo saw an opportunity to start a firm that hyperspecialized in YouTube. “YouTube is unlike anything else. It is an ecosystem,” Budica says. “Shorts, livestreams, longer videos, music videos, YouTube Music.”

Unlike the plethora of YouTube distributors and rights management firms that simply collect money from the platform and send artists and labels a check for what they’ve found, Ten2 sees itself as a high-touch service, handling YouTube royalty collection but also helping clients strategize content creation specifically for the platform. Those services include helping artists and labels create lucrative livestream loops of their videos, building out playlists of their songs, capturing publishing dollars from user-generated covers and developing strategies to attract new audiences with their Shorts. While Billboard has reported several stories about rights managers employing fraudulent schemes to siphon royalties from YouTube — often from unsuspecting independent artists who don’t have access to the streaming service’s content management system (CMS) — Ten2 offers clients a “completely transparent” dashboard, Karalexis says, that provides “educational tools, greater understanding about analytics — like what’s working, what’s not working — why and how to expedite growth,” Budica says, finishing his thought.

Karalexis and Budica’s clients include Warner Records, Rhino Records and a number of distributors that wish to remain anonymous, and they say they have had major success with such mainstream clients as Brent Faiyaz, Benson Boone, blink-182’s Travis Barker and NLE Choppa, to name a few, and have helped Christian artists Maverick City Music and Don Moen earn six-figure incomes on YouTube alone through savvy strategizing.

With data analytics firm Kantar reporting that YouTube Music was the “most adopted music streaming service” for the second quarter of 2024, and Luminate’s findings that YouTube Shorts are nearly at parity with TikTok when it comes to U.S. music listeners using the platform — more than 30% — Karalexis and Budica contend YouTube has a strong future. “We saw the writing on the wall,” Karalexis says.

Karalexis says he was given this guitar pick after seeing his first concert, Eric Clapton, in 1992. “That experience changed my life and made me want to pursue music.”

Yasara Gunawardena

Should all artists use a service like Ten2, or are there artists who fare better on YouTube with your guidance?

GEORGE KARALEXIS: If you don’t have a partner that understands YouTube [and has access to its CMS], then you’re blind on the platform. It’s not like Spotify and Apple, which have this very [similar] systematic approach where the song just kind of sits there. YouTube is part social network, part streaming service. So if you’re actively creating content on it, you’ll see a lot of upward growth of your own making. Also, Spotify and Apple don’t share how often listeners skip a song or how long people listen to your songs. If you get a partner with access to YouTube’s CMS, you can really get an understanding of who your audience is and who your potential audience is.

You’ve had success working with Christian artists. What makes this genre distinct from others?

KARALEXIS: We’ve found that Christian is song-based rather than artist-based. House bands at churches play lots of covers of popular Christian songs. Don Moen has written huge songs that get covered over and over, and the covers are even bigger than his original. Through that process, we realized there were a lot of royalties to claim. We also found success using keywords that Christians are searching for, like “Sunday prayer,” “worship,” stuff like that. YouTube is the second-largest search engine for folks behind Google, so these keywords really work to drive traffic. Also, it’s very driven by lyrics and long-form consumption. We’ve started a 24/7 livestream, like the Lofi Girl study beats videos, and it’s been huge. We’ve found that people watch these streams for an average of an hour and 50 minutes. Another example: We work with a few superchurch pastors, too. They have such a hardcore following that tunes in. They might draw 1,000 people in person, but on YouTube they’ll have 15,000 to 20,000.

DONNA BUDICA: But all these approaches are genre-agnostic. It doesn’t matter if it’s hip-hop or Christian or whatever. Everyone can benefit from a livestream or a lyric video or keywords.

What makes Shorts distinct in the short-form video space?

KARALEXIS: When someone opens the YouTube app on their phone, their mentality is very different than if they just choose to click on TikTok or Instagram. They are [typically] someone who watches long-form, someone who wants to get frequent updates from a person they subscribe to, whereas TikTok is quick virality-driven. We look at Shorts as a brand-builder — onboarding fans versus driving audio consumption.

“Disraeli Gears by Cream is my earliest memory of music,” Karalexis says. “I remember flipping through my dad’s vinyl collection and always asking for this one to be played.”

Yasara Gunawardena

Recently, a lot of labels have turned away from making high-quality music videos for singles. Why do you think that is?

BUDICA: YouTube is no longer a place where an artist should put out one really expensive music video every era and go away. Consistency is key, and the YouTube algorithm rewards that. If you’re constantly putting out one long-form video [shot on an iPhone] every week or every month, it’s better.

KARALEXIS: Hip-hop got it right first. They would do these lifestyle videos, where it’s them with cars, their friends. They’re showcasing the life that their lyrics are selling.

Warner Music Group CEO Robert Kyncl joined the company from YouTube. Is this leadership one of the reasons WMG hired Ten2?

KARALEXIS: Our relationship actually predated Robert. We started working with Warner in late 2021, early 2022. I think [Warner Records co-chairman/COO] Tom Corson is a really smart guy, and he’s always trying to find a competitive edge and find ways to service artists differently.

Does the restructuring at Atlantic Music Group affect you and your artist clients?

KARALEXIS: No, we mostly work with Warner Records. We also service a number of indie labels and artists that are not public.

YouTube is trying to launch a TV equivalent to rival Netflix and other streaming platforms. How will this affect your artists?

KARALEXIS: We’re seeing huge spikes in TV consumption already. It’s the next frontier. It’s so hard to break an artist on a phone because of the barrage of notifications you’re getting on there. Sometimes I don’t even remember what content I’ve seen because I was so distracted. On TV you’re not [barraged], so it has a lot of potential.

Budica says her diploma reminds her to “maintain a beginner’s mind while continuing to build upon the tools, fundamentals and passion for business that Wharton gave me during my formative years.”

Yasara Gunawardena

Artificial intelligence-generated or -assisted videos are starting to appear on social media. Will the rise of AI content hurt your clients’ chances of breaking through the noise?

BUDICA: Any kind of milestone in technological advancements could be malicious. But the reality is it’s here and it can expedite content creation. That’s how we choose to approach it.

KARALEXIS: Yeah, what can you do? Throw up your hands? Then you’ll get left behind. We have to embrace it. We’ve seen it help with Don Moen’s content creation. AI has helped him tremendously to create quick lyric videos and increase their output. We have a lyric-video generator and it can make, like, 50 versions a day.

Is that the future of shortform video platforms — generating a million versions of the same thing?

BUDICA: I’m going to say a soft no. It’s not about blindly putting out volume. It is good to experiment, but it’s about putting out things that resonate with your audience and using analytics to figure out what’s working.

The last year has had an influx in catalog sales and viral bumps for songs that are decades old. What are the opportunities on YouTube for catalog marketing?

KARALEXIS: Massive. Repurposing is important here. Donna came up with this idea of “surface area.” For someone who is deceased or no longer able to produce new material in a traditional way, the method has always been the same: a remaster, a reissue, but there’s a lot more we can do now. You can reintroduce the artist in a number of ways. For example, with The Beatles on YouTube, you could create a ton of playlists [videos that play in a particular order] that are based on keywords and themes, like “Beatles acoustic songs,” “Beatles love songs.” Sometimes it is as simple as reworking their old videos into 4K and uploading them with higher quality. We are very bullish on catalog and in deep discussions with some estates.

You’ve been working with major labels, including WMG, but do you think there is any danger in the majors ever trying to replicate your process in-house?

KARALEXIS The majors could do it [in-house], but they are downsizing and consolidating. For them to build what we’ve done from scratch in-house would be hard, and surprising.

“Much of the artwork in my office, including this one, was drawn by my dad, who came here on a boat from Italy [and] is an aerospace engineer,” Budica says. “His name is on the moon, but he also designed album cover art in the ’60s.”

Yasara Gunawardena