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User Loyalty and Willingness to Pay for a Music Streaming Subscription

By Nell Jones   

Music streaming has increased industry revenue and displaced piracy, but limited profits for artists. In this thesis, I examine user loyalty to streaming platforms, focusing on the asset specificity of features and estimating what users are willing to pay for each of these features. A structural equation model of survey data shows that feature satisfaction positively affects both asset specificity of and overall satisfaction with streaming platforms, strengthening user loyalty. Using conjoint analysis, I estimate that users are willing to pay at least $14.40 for platforms that offer algorithm, playlist and social features, and the ability to download music.

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Advisors: Professor Michael Munger, Professor Grace Kim | JEL Codes: Z1, Z11, M21

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