All music is collected into a hierarchy of directories, and the contents of the current directory is always shown in the listing window at the bottom of the client. When you press the Local button, you change the current directory to a builtin directory containing a listing of all the recording that are available in the group.
In addition to the Local directory, each user has a Home directory where she can collect music in the form of subdirectories (also called collections). This allows each user to collect music from multiple sources to be played back in sequence.
The following few pages describe the directory structure in more detail.