YouTube, for instance, let's people upload videos and they remove things that are copyright violations.
Why not have the same for audio but remove the stuff that gets reported for DMCA violations? How much of a challenge is there that I'm not seeing?
This may be an interesting idea. I do not know too much about the music industry, except from what I've read and the people I've talked to. Here's a quote I remember reading from PG (taken directly).
"...record labels...are effectively a rogue state with nuclear weapons. There is nothing we or anyone else can do to protect you from them, except warn you not to start startups that touch label music."
I am not sure if that is ample enough advice, but it is a strong warning. I don't exactly know what "touching" label music means, but I'm assuming it would apply to your situation since I have a feeling that the vast majority of the "audio" would be music. Self-produced music is fine (as long as it doesn't have 7 or more consecutive notes that belongs to another song, I believe), but I think you may have problems when people start to post label music on your site. From what I understand (I've studied law for 4 years), labels can begin to file copyright claims against you. It's common practice and unless you have the legal firepower to combat it, you and your company may be quickly smothered by legal issues and fees (and even damages).
In all, I think the risks here far outweigh the rewards. Even from the perspective of managing schlep for gains, I think this battle is so uphill it's like trying to scale a vertical wall. I have a strong feeling that you'll have much more fun with another project. :)
Sounded like a cool piece of tech, but a not cool use case. Kind of like designing a golden violin that plays like a Stradi - for Belzebub.