Brando has listed an external Flexible Mini Capsule Microphone for the iPhone which is said to improve audio recording by 10x.

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Voice and video recording on iPhone 3.0 brings iPhone owners to the new mobile multimedia era. Yet, sound quality is not the best. Try out the NEW Flexible mini capsule microphone which is especially designed for new iPhone 3.0. It enables you to record better sound quality. Instead of receiving sound from the iPhone speaker at the bottom, your iPhone can receive sound from any direction.
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