I love specialized controllers, providing an interaction metaphor that works with a keyboard and mouse is always sub-optimal as they are general input tools - that's one of the things that's so awesome about the iPhone, it allows the application to define a much more specialized interaction - look at the way different apps use the multi-touch. That's just the start, too. The iPhone has limited gestures and is 2D, I expect much more to happen with it as interaction designers get to grips with the underlying change in capability that multi-touch provides.
I wrote last year about a whole host of multi-touch devices that show off the cream of what's currently possible. One of the stand-outs for me was the JazzMutant Lemur, shown here as a music sequencer.
I've been keeping half-an-eye on music companies to see what comes out as keyboards, sequencers and digital DJing gear are all natural applications of specialized interfaces. A few days ago I spotted the Yamaha TENORI-ON. An LED based sequencing interface.
Here it is, in a short product demo
And here it is being shown off by it's creator Toshio Iwai.
I knew, when I saw it, that I'd seen the idea before. The concept is the same as the Monome devices sold in kit form: