Sorry the photo is not great. It’s a switch for more or less tremble in a way, simple equalization. It’s interesting that Sony chose not to go down that route probably betting on superior playback sound quality.
In regard to the tone control on the TPS-L2, as others have already mentioned it does have a tone control, but that is different from the EQ present on the WM-3. Simply put, the TPS-L2 was designed to only play normal TYPE I ones (with 120μs equalization), and not TYPE II and TYPE IV (which are recorded with 70μs EQ). Despite the tone control will be better than having nothing, the sound won't be as it should on TYPE IIs and TYPE IVs. Attached the differences in the circuits below.