I’ve used Rdio for the past half-year and thought I’d explain how it works. I also had Spotify for a similar amount of time before switching to Rdio. They are very similar; I liked Rdio more.
You rent music from Rdio for about $10/month (I’m paying $18 for my wife and me plus another $5 for my son). We each get unlimited music and downloads. We each have separate accounts. Really! You can download thousands of songs to your iPhone, iTouch, or other smart phones. Obviously, you can only download limited by storage capacity. I do that for music I listen to regularly so it keeps working while I’m on the subway. If music is not already stored on my device it is streamed so you can always listen to more music.
When you stop paying you lose access to the music.
You can download an app for you Mac — for some reason I tend to prefer desktop apps. Probably some outdated notion that desktop apps are more capable then a web based interface — not so true given the number of people that use web based interfaces.
The web interface is pretty similar to the app. It’s nice because you can use it without installing any software so it’s much easier to use a work.