Sorry, meant to add that another reason for running a local server is synchronisation. My understanding is that without a local server, if I am listening to the same track in three rooms from mysqueezebox, then there will be three separate streams coming into my house. If I run a local server there will be one stream into the house from the Internet, and then that will be served out across my local network to the three clients. Think that's right? I'm definitely seeing synchronisation issues at times with two clients, and see how this would help.
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