According to this Salon article:

"Speculation continues to run wild about President Bush's mystery bulge. Since Friday, when Salon first raised questions about the rectangular bulge that was visible under Bush's suit coat during the presidential debates, many observers in the press and on the Internet have wondered aloud whether the verbally and factually challenged president might be receiving coaching via a hidden electronic device.

Now a technical expert who designs and makes such devices for the U.S. military and private industry tells Salon that he believes the bulge is indeed a transceiver designed to receive electronic signals and transmit them to a hidden earpiece lodged in Bush's ear canal."