Last.fm sounds like the canonical example of a site that where it makes absolutely no difference if your password gets exposed. Worst case, some malicious individual on the internet will learn that I still like the Beastie Boys, even though it's not 1994 anymore. And possibly they'll listen to music in my name. This is why one has a throwaway password. For throwaway accounts at throwaway sites like this. Getting your…
It matters because many users re-use credentials.
Scenario: You send a confidential email to a colleague, colleague has her lastfm compromised. Attacker scripts up logins against all common sites - including her Gmail account where you sent your confidential email. Script not only logs in and changes password, it also forwards to her friends and family all the emails containing some target phrases - including your confidential one.