A good sound card is kind of a must if you have half-way decent analog speakers or headphones. But not all systems have room for a PCIe sound card—especially microATX and Mini-ITX builds. That’s where Diamond’s new Xtreme Sound 7.1 USB audio box comes in.

The Xtreme Sound 7.1 is pretty much an external sound card. It hooks up to your PC via USB, processes audio with a C-Media chip (with 24-bit, 192kHz precision), and outputs sound through a plethora of ports. At the back are 3.5-mm rear, side, and center/sub ports, plus stereo RCA connectors; on the side are optical S/PDIF in and out ports; and at the front lie 3.5-mm line in, mic in, and headphone out ports. A top-mounted volume knob rounds out the package.

As you can see from the photo above, the Xtreme Sound 7.1 is tiny. Diamond quotes dimensions of just 3.1" x 3.1" x 1.0" (80 x 80 x 26 mm). The price tag is similarly diminutive: only $39.99. Diamond hopes to ship the Xtreme Sound 7.1 at the end of this year’s first quarter.

Come to think of it, this thing might make sense even for my own, full-sized PC. My speakers are hooked up via S/PDIF to my motherboard, and my headphones are connected directly to my sound card. I have to change audio devices manually in Windows to go from one to the other, and I can only adjust the headphone volume in software—not terribly convenient when I’m gaming. An external sound card with a volume knob and both S/PDIF and headphone outputs would simplify that setup nicely, and it’d free up an expansion slot.

Update 1/16/14: Diamond tells us that it may not be able to hit that $39.99 price tag. We’ll keep an eye out for a final pricing announcement.