Water damage.
Always be careful, because an iPhone is very sensitive for water. When water gets in contact with the iPhone or iPod, it's possible that he won't work anymore. The image beneath shows a very sensitive spot. When water enters this spot, you'll probably have problems with your home button.
If you have this problem, just make sure that you'll try to dry this spot and if he doesn't work after a couple of days, then he is probably broken. So be careful and watch out.