I've spent the last few minutes prodding the Steam Music beta. You can, too: it's now open to all who want to try it. It's, er, well basically, it's an mp3 player. But one that you can access in-game, through the Steam overlay. Yes, I know, not revolutionary, but there are a some reasons why it might be useful.
For instance: Big Picture mode. If your PC is hooked up to a TV and a control pad, it's a pretty convenient way to blast out some custom tunes (that's still a thing people say, right?). And with the impending Steam Machines and Steam Controller, it makes sense that Valve would want to offer this type of in-app player.
Apart from that, it's a pretty basic tool. Thanks to the combination of standalone media players and keyboard shortcuts, I doubt an integrated Steam player was high on people's gaming wishlist. But it is early in the beta process, and that means there may be planned features that make Steam Music a worthwhile addition. For one thing, it's increasingly common for games to offer soundtrack "DLC" through Steam. Currently, they're just deposited into that game's Steam folder—but having them caught by the player would make sense as an option.
And, of course, it still needs to be Valvified. It'll be interesting to see if there are plans for weird sharing schemes, or playlist features, or any of the other ways Valve like to use their users to enhance their features.
To try the app, head to the Steam settings and opt-in to the latest Steam Beta Update.