You don't need a new controller, just a new mic. This is a problem that has plagued many a mic. I have one, a friend has one. Mic breaks, but speaker works. Try the mic on a different controller... if it still doesnt work, then its just the mic (as i think it is). And yes, you'll need to (unfortunately) get a new one.
dude the mics are soooooooooooooooooooo lame. i've go through aobut 1.5 a month and i treat them like a newborn