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Professor Bull Explains: Royalties — How a Song Keeps Paying

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4 days ago

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Welcome in, class. Put on something with a good melody, because today’s lesson is about the paycheck that never clocks out. A construction crew gets paid when the building goes up. A great song gets paid every time the world presses play — sometimes for a hundred years. That long, patient stream of money is called royalties, and here is how it works.

Every recorded song is really two things wearing one coat. The first is the composition: the melody and lyrics, written by songwriters and usually handled by a music publisher. The second is the master: the actual recording, usually owned by the artist or the record label that paid for the studio time. Keep those two separate in your mind and royalties stop being confusing, because different money flows to each side.

When a song streams, both sides earn. The composition earns a publishing royalty, collected for the writers. The recording earns a master royalty, paid toward whoever owns that recording. When a song plays on the radio, tradition pays the writers and publishers — in the United States, the recording side historically earns nothing from ordinary radio play, a quirk performers have debated for decades. When a song is sold on a record or a download, both sides earn again, at rates set by contract and by law.

Then there is the royalty every artist dreams about: the sync license. “Sync” means a song placed in a film, a series, a commercial or a video game. Each placement is a negotiated fee, plus royalties when the show airs. One beloved chorus in one hit holiday movie can quietly pay its writers every December for generations.

This is why catalog sales make headlines. When a famous writer sells a lifetime of songs, the buyer is not collecting trophies — they are buying thousands of tiny future payments, arriving from radios, streams, films and phone speakers all over the world. It is also why the name on the writing credit matters more than the name on the stage. The singer may be famous for a decade. The song, and whoever owns its two halves, can earn for a century.

So the next time an old favorite fades in under a movie scene, hear what the business hears: a small bell ringing, a small payment moving, a song still at work. Class dismissed.

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We Speak Financials

Formula 1’s Money Boom in America

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16 hours ago

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October 27, 2026

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A generation ago, Formula 1 treated the United States as a nice place to visit. Today it treats America as the engine room. Three U.S. races, a Las Vegas event the sport promotes itself, and team values that now rival the biggest franchises in American sports tell a story that is less about lap times than about money — and the money is moving fast.

Start with the valuations. In Forbes’ November 2025 ranking of Formula 1’s most valuable teams, Ferrari led the grid at an estimated $6.5 billion, with Mercedes second at $6 billion and McLaren third at $4.4 billion. Across all ten teams, the average valuation reached $3.6 billion — up 89 percent since 2023, according to Forbes — and every single team on the grid was valued at $1.5 billion or more. A cost cap introduced in 2021 turned teams from spending contests into controlled businesses, and investors have priced them accordingly.

Then there is Las Vegas. Formula 1 did something in Vegas it does almost nowhere else: it promoted the race itself, buying land, building a permanent pit facility and collecting the ticket and hospitality revenue directly. The inaugural 2023 race generated an estimated $1.5 billion in total economic impact for the city, according to analysis by Applied Analysis reported by the Las Vegas Convention and Visitors Authority, including $884 million in visitor spending — with attendees spending about 3.6 times more than the average Las Vegas visitor. The race drew a global television audience reported at 59.3 million.

The audience story backs up the asset story. The inaugural Las Vegas race pulled 1.3 million U.S. viewers on ESPN despite a 1 a.m. Eastern start, and the sport’s American calendar — Austin, Miami and Las Vegas — now gives sponsors three premium weekends on U.S. soil instead of one novelty stop.

Austin’s long-running race and Miami’s event, added in 2022, round out the American trio, giving teams, sponsors and broadcasters a season-long presence in the sport’s largest commercial market rather than a single annual visit.

Put it together and the boom explains itself: capped costs, soaring team values, a self-promoted American flagship race, and sponsors paying record rates to stand next to all of it. Formula 1 did not just find America. It found America’s wallet — and America’s investors found it right back.

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