I can't imagine how it could stream music from artists I already know..
I'm a musician, too. I meant that someone could start a GNU FM service and stream music that has been licensed legally from musicians.
http://magnatune.com/info/give
So letting the whole world listen would break the agreement, but just streaming to you, your spouse, and maybe a buddy or two would be "OK" or at least well within the spirit of the agreement. Just no more than 3 other people. I'm not exactly sure why you'd stream rather than just share the file, but whatever. Maybe you have purchased gigs and gigs of music licenses and want a jukebox effect, donno.
I've purchased rights from magnatune in the distant past, and would recommend them. I like their business model and they did the deal professionally and quickly, and I've not heard anyone complain about them. Good people, basically.
Libre.fm is five years old now. Time for us to break the chain?
But yes, there is a good use case for someone creating a popular GNU FM site that plays music that's not under a free license.
Didn't Twitter just shut down their site that did just that?
http://i.imgur.com/S8DVnZg.png
https://gitorious.org/foocorp/gnu-fm/source/3f2cfbb47959c7a9... is the code that does it.
Libre.fm is the main instance of the GNU FM software. GNU FM is compatible with the audioscrobbler API and supports streaming. Additionally, you can mirror your scrobbles from GNU FM to last.fm if you want. Libre.fm is a great if you want to check out some free culture music.