While Last.FM has been available on the Xbox for some time now, there has not been a dedicated music app branded under the Xbox name. That has now changed with the addition of Xbox Music to your dashboard, replacing Zune as the default music player. To top it off this will be available to Windows users and soon-to-be Surface tablet users.
The free subscription will net you ad-supported music and limited access to the 30 million song large Microsoft library. A paid subscription will give you ad-free streaming and unlimited access to the catalog. Xbox users also have access to the music video catalog as well.