Seattle's nuTsie has received approval from Apple for a new iPhone application that recommends and streams songs based on the music tracks found on one's iPod or iPhone. The app -- dubbed Effin Genius and costing $1.99 -- creates unique playlists of songs from "billions of pieces of data" collected by nuTsie.

The music service sounds a lot like Pandora, which also creates playlists of songs based on one's personal tastes. But in an email today, nuTsie's Dave Dederer said Effin Genius is more like "Pandora on steroids."

"Each Pandora playlist starts with a single input -- the artist or song you initially request as a basis for your playlist," he said. "Effin Genius looks at all of the music files and playlists on your iPhone or iPod and then uses our own proprietary collaborative filter to generate new playlists based on the music you already have. We compare your playlists against all the data we've gathered from people's iTunes libraries...we find people who like the music you like and then deliver to you stuff they have that you don't have."

Jim Billmaier, CEO of nuTsie parent company Melodeo, also explained the differences in a statement released today.

“We’ve learned that people discover music in two ways,” he said “They listen to the radio and they get recommendations from friends who share their musical tastes. That makes Effin Genius the killer music discovery app – it’s like having your best friends program radio stations for you. And, unlike other Geniuses out there, we actually play you unlimited full tracks of great new music that’s not already on your iPhone or iPod.”

nuTsie also hinted that the release of Effin Genius is part of a larger effort by the company, with more details to emerge in the coming weeks. In his statement today, Billmaier said it will release a new "cloud-based product" which turns "any connected device into a full-on iPod.... but better."

We'll have to wait to find out more about what that means.

But there's certainly a lot of activity right now in the online music space, especially after Apple gobbled up online music service Lala. Interestingly, both Lala and Melodeo are backed by Ignition Partners.

John Cook is co-founder of TechFlash. Follow on Twitter @johnhcook.