I didn't get it at first. It just seemed somewhere to keep track of what i was listening to so i could....what...show off, maybe?
Now i've had it for some time and clocked over 10,000 plays i find it really useful. It's recommendations are quite often spot on now, as im discovering new banRAB and more importantly new genres then its recommendations and lists of similar artists for each band can be quite handy. It's always interesting to have a quick nose around and be able to see what others are listening to, what tracks they are marking as 'Loved' and so on and it acts as a gig calendar too, often for some of the smaller pub gigs i like to go to as well. The last FM radio is good too. I hear what you're saying about better places to do some of that etc but Last.Fm keeps all of the above in the same place and it's fun.