Simplify media is a combination desktop / iPhone app that allows you to connect to your entire music collection (includling songs that you haven't uploaded to your iPhone), as well as your friends music collections as long as
(1) you are connected via wifi
(2) your simplify desktop application (similar to an im) is running
(3) any friend who you wish to share music with has the desktop app up and running
The app is currently free (the company says they will increase the price to $3.99 once they hit 100,000 users).
Now I love the idea of sharing playlists with friends and listening to their music, but after playing with this app for over 2 hours, i am convinced that it is inherently unstable and could very well completely crash your iPhone (it crashed mine). I don't like the fact that app requires a desktop add on, and wifi. This is clearly a workaround for sharing playlists; it is rumorred that Apple will soon build in similar functionality into the next version of Itunes anyways. Stay away from "Simplify".