Its either a keylogger or an old "software key" - similar to the USB keys to verify if software is legit, they had older PS/2 versions available, and i believe its that. I've seen then on some VERY old systems... the fact that the computer picutred has RCA out for video, makes me assume its to prevent software piracy
I have not seen one of those in a long time. I have seen two different versions of that, one was a DRM device to unlock an application the other was a remote controlled keylogger that recorded everykey stroke into a hidden file on a hard drive. The keylogger version that I saw would not allow the computer to boot into the OS without it being attached.
Are there any markings on the module?