While I was at ShowStoppers at CTIA Spring 2011, I saw this guy from Gear4. This is PocketLoops, a Portable Music Creation Studio designed for the iPhone and iPod Touch.
It is essentially a keyboard with 13 keys with a 30 pin dock that can do instruments like synthesizers, organs, and pianos. As you can see, it turns the iPhone/iPod Touch into a touchscreen controller for all kinds of effects.
With a little work, the user can mix and records his or her own tracks, and the user can record his or her backing track. There are also three built-in effects that include Echo, Chorus, and the XY Filter Pad.
PocketLoops allows the user to record loops for music. The user can also create beats with a drum kit and groove that includes House, Drum & Bass, Hip Hop, Rock, and Reggae.
There is an App that allows the user to send best tracks to and share it with friends via e-mail. This App is free, but the PocketLoops will cost about $69 when it is released sometime in May.
You know, I have a suggestion about how to improve the Pocket Loops. If the dock were in the upper center portion of the keyboard instead of the side, it could possibly accommodate an iPad.