Last.fm is one of those rare gems of the Internet age. The idea that anyone can navigate to a website and instantly start listening to a huge library of music for free sounds ludicrous in principle - there's no obvious business model - yet that is exactly the service Last.fm offers and, somehow, it works. And while there are other sites out there offering near enough the same thing, Last.fm is, thanks to the breadth and depth of its service, almost certainly the best.
Better still, unlike similar services available in the US, such as Rhapsody and Pandora, Last.fm is a UK-based site (London to be specific) and as such is available to us Brits. Equally importantly, the big name record companies (Universal Music Group, Sony BMG, Warner and EMI) are on board, as well as a slew of indie labels offering some 3.5 million tracks such that fans of any genre of music, from blues through jazz and rock through to yodelling should find something worth listening to.
At its simplest level, Last.fm works through a flash-based web interface and allows users to listen to full-length free tracks of similar genres. To get the full benefit, though, it's necessary to create a profile. Doing so allows Last.fm's automatically generated playlists to be created based on a user-input list of favourite artists and when tracks are playing they can be rated as loved or hated. This data is then compared with that of other users to help improve the likelihood of tracks being to the listener's taste.
Going one step further, downloading the Last.fm desktop client allows not only the listening of music from Last.fm without being on the site, but also a process referred to as scrobbling. When listening to tracks with a compatible media player (iTunes, Windows Media Player and Winamp notably are all supported) information about what's listened to, what's skipped and so forth is uploaded to the Last.fm servers and used to refine the prediction engine's results even more. Data from portable players can be added too - finally a reason for having a 'play count' on my iPod!
If you're still not convinced, maybe support for Last.fm playback via Logitech Squeezebox and Sonos systems can tempt you. Sonos even supports scrobbling of tracks played via a setup to a Last.fm account! Heck, there's even an iPhone/iPod touch client.
On the financial side, Last.fm pays a royalty fee to the recording artist for every song listened to as and when played and recoups that cost in three ways. First, there's the adverts on the site, which most users will never notice as once music begins streaming there's precious little reason to stick on the site. In fact, there are several ways to listen to Last.fm that bypass the website entirely - including the official desktop client. The second, and undoubtedly least reliable, revenue stream for Last.fm comes from donations. Last but not least there's the option to subscribe and subscribers get a number of perks to justify the £1.50 per month cost.
Probably the most useful benefit, from a user experience perspective especially, is the ability to build custom playlists. As great as Last.fm's ability to pick great songs to play is, there are times when it's nice to have a bit more control. Other benefits include the removal of adverts from the site, the ability to see who's been looking at your profile page and access to the Beta programs.
On that note, Last.fm is currently in the process of rolling out the next level of its subscription service, which will bring it in line with 'real' subscription music services. Tracks are subject to a limit of three free plays whereupon they're no longer accessible directly - although so far as I can tell they will still show up in the random, auto-generated mix. There's nothing worse than trying to get a quick fix of Outkast's brilliant Hey Ya and being told "we're sorry, but you've reached the limit for free plays." This subscription service is set to see a further fee on top of the 'basic' subscription currently offered but as long as the price is right I can see it becoming a serious threat to the current players in the market.