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I don't understand why buying music on iTunes was so popular in the US for a while, when in Europe everyone was already listening to Spotify.

in Europe everyone was already listening to Spotify.

Spotify wasn't available in the US until almost 2.5 years after its initial launch.

But weren't there other streaming services such as last.fm and pandora?

More disposable income, different culture that values actual possession more then merely enjoying it.