This is an interesting use of the Arduino.
The Auduino is a sound synthesiser based on the Arduino platform. The prototype uses the Arduino Diecimila, although any Arduino running at 16MHz will work fine. It uses granular synthesis techniques to generate a distinctive filter-sweep sound that had much more character than boring square waves.
It sounds like there are quite a lot of possibilities here, if of course you have an Arduino in the first place. The site has some interesting links, including the video about and this Flckr set of a really nice cased Auduino.
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