Samantha Rose Hunt18 March 2009, 9:00 PM
The new iPod Shuffle contains a mysterious chip which sparked rumors on many a blog this weekend.
BoingBoing Gadgets, and
iLounge discovered the chip, and tried to determine what the exact purpose of the “8A83E3” which was found inside the earbud control pod. BoingBoing Gadgets and the
Electronic Frontier Foundation theorised it might have been some sort of DRM.
As it turns out, they were half right. Apple has defined the chip as needed for its “made for iPod” program, and though it didn't say so, this may be because it lost control of the iPod connector licensing, after electronics makers realised it was a simple pass-through connector, with no special authentication.
Several vendors have already begun announcing intent to manufacture earbuds and headphones which are compatible with the shuffle. On Monday an Apple spokesman claimed "As part of the 'Made for iPod' program, we make sure that third-party headphones work properly with the third generation iPod shuffle," however he didn’t give specific details. (In simpler terms: if you don't buy this chip, the headphones likely
won't work as a controller.)

Any questions regarding the device and the chip are currently being referred to Kevin Lee, the vice president of marketing and strategic business development for Monster Cable, which plans to offer “a lot” of headphones which will support the iPod Shuffle controls.
Lee has claimed that it is a control chip, and that there is absolutely no authentication or DRM.
Utilizing the chip, signals can be passed through the cable which controls the track, and volume, and other device functions.
It is unknown at this point whether or not the chip will be a part of other Apple devices, or a part of the company's intellectual property protection strategies. Apple does not supply the chip, but instead a set of guidelines or required functions for the chip itself, meaning companies will be forced to manufacture their own chip for use in compatible headphones.