Sources at a headphone manufacturer confirmed today to BBG that new iPod headphones do use a proprietary chip available exclusively through Apple. However, it's described as a "transmission" chip, suggesting that its role is not authentication or digital rights management, even if the result is to encourage manufacturers to pay an "Apple Tax" to license technology that allows their products to be used with iPod equipment. This partially corroborates iLounge's original report. iLounge noted that the new included headphones with in-line controls use an "authorization chip" to communicate with the iPod, a part available only from Apple. (Apple uses a similar chip inside the latest iPods to prevent video output from working with unlicensed iPod docks and other accessories.) We took off the covering from our iPod Shuffle remote and discovered a chip labelled "8A83E3" soldered to the back of the remote, connecting a third wire to the second ring on the minijack plug, the same wire the iPhone headphone remote uses to send an simple electrical on/off signal to the iPhone. When reblogging iLounge's review, both the EFF and Boing Boing used the term "DRM" to describe the "auth" chip. BBG used the same term when questioning the function of the chip, which became understandably confusing for some, as an authentication chip, while perhaps using signaling that could not be legally reverse-engineered due to the restrictions in place from the Digital Millennium Copyright Act, does not affect the ability to listen to audio through generic, unlicensed headphones. (Except, of course, in the new Shuffle, which uses only in-line controls.) For the record, we do not believe that the new iPod headphones with in-line remote use DRM that affects audio playback in any way. That said, a three-button in-line remote could have been easily implemented by Apple without a microcontroller. While the in-line remote is simply an added convenience in most iPods, the iPod Shuffle has no controls on the device itself. To control the latest iPod, customers have no other choice but to use headphones made by manufacturers who have purchased a licensed authorization chip from Apple. Since the new controls also work on the latest iPods and MacBooks, we can now presume that all future headphones released with the iPod controls will include the added cost of the licensed authentication chip from Apple. Update: Macworld.com also confirms it with additional sources. The next step? Someone with diagnostic ability should try to replicate the function of the iPod remote to determine whether or not it is encrypted. If it is not, it should be possible for unlicensed clones to be made without fear of legal repercussion. Our sources could not confirm any encryption of the signal, but bear in mind that they only solder in the chips that Apple give them. That said, they did confirm that the new headphones still operate the middle button with the same drop in resistance as the old iPhone headphones, so I suspect any special signaling to control the volume is not encrypted. Update 2: Just spoke with Apple. There is no encryption or authentication on the chip, so clones could conceivably be made, just not with "Made for iPod" official certification. And now we know! Update 3: iLounge explains the business behind Apple's licensing schemes:
From what we were told, Apple offered to sell developers the chip for $1 in a bundle with a $2 microphone, costs which are then multiplied and passed on to consumers. The component costs are now apparently lower. There are also authentication chips inside the new Apple Earphones with Remote and Mic, and the In-Ear Headphones with Remote and Mic–the ones that you may recall were delayed last year for mysterious reasons.