Ambrosia Software, a longtime Macintosh software developer, has released WireTap, a free utility for OS X that records any and all sound currently coming from the Mac. Amusingly, the product description explains a few reasons why this might be useful:

This allows you to record news from Internet radio stations such as the BBC News, sound snippets from your favorite DVD movie, record the audio from a game, or even iChatAV conversations.

Can you spot the missing application? It's the one for which WireTap will be used roughly 99.2% of the time. It's iTunes, folks. People will use this to converted their Fairplay-encumbered iTunes Music Store purchases into unencumbered audio files without burning them to CD and re-ripping them (with a resultant degradation of quality).

This is, of course, the purpose of the utility. While it is not mentioned in the text (beyond the statement that "RealPlayer, iTunes, DVD Player, Windows Media Player, etc. are all supported"), the supplied screenshot makes it clear. While Ambrosia has enhanced their plausible deniability by not encoding directly to MP3 or AAC, it is a trivial matter to encode a raw AIFF file to either format, and WireTap is fully scriptable. In fact, the president of Ambrosia has already stated that if someone writes such a script, he'll happily bundle it with the next release of WireTap. (On an Ambrosia forum thread, in a post dated '07-08-2003 11:36 PM')

There is a popular existing utility for OS X 10.2 that does the same thing (and more), Audio Hijack, but it is $16 shareware, while WireTap is completely free.

And oh yes, this also enables one to use the included Applescripts to record (for example) radio shows broadcast online. I might actually use this to record my favorite local NPR radio show every weekday.