Apple calls the new shuffle the World's smallest digital music player. With 0.5 cubic inch (8.19cm3) (without the clip) I need to agree it is the world's smallest portable audio player.
For me an important distinction is though that the iPod shuffle does not have a display.
So comparing the shuffle to the MobiBlu Cube DAH-1500i is not a valid comparison. The MobiBlu Cube (volume: 13,82cm3) is still the world's smallest audio player featuring a display (something many consider as essential). It is actually amazing that Apple sold 10 million of the most simplistic music player out there so far. The new iPod shuffle actually looks cool and the clip design is great. At $79 it is also priced low enough to clip this audio player anywhere. More details on the Apple iPod shuffle product page.