Everyone is bringing up licensing
But couldn’t you just stream music you own, to one person at a time? Like lending a friend a cd, which has always been ok.
If I own a cd with 12 songs, maybe to preserve parity with the aforementioned example, one person could listen to a song from that cd while I’m not listening to it. You couldn’t have 12 people listening to different songs from that cd, because you can’t lend the real cd to 12 people at once.
Such a library could get really huge by raising donations to buy out thrift store music collections, records and tapes and cds, to build a big catalog quickly.
And yes I know the music industry would still get mad, but on paper it makes sense.