I had the same idea but dropped it after seeing GrooveShark and being too busy with other things. Still, it has tremendous potential. A lot of people get their music from YouTube, but there's currently no good mechanism to leverage that.

Now, for the advice:

1. On the front page show who's listening to what. Drop the How, What, etc. Don't tell people. Show people.

2. Allow people to create playlists with interjections, such as "That was Little Dragon with 'Twice', and now..."

3. Allow people to do insert temporal video casts: Sports, weather, news.

This could be really big if you hit it right. Find a designer for God's sake. And feel free to drop me a line. My email is my profile.