Back in 1889, two entrepreneurs named William. S. Arnold and Louis Glass introduced an amazing new device at the Palais Royale Saloon, a popular San Francisco watering hole.

The tow men had devised a way to modify a phonograph—Thomas Edison had patented the invention just a decade before—to accept nickels before playing a tune.

There were no speakers. Patrons had to listen through a tube—four tubes were provided. Nor were there many tunes to choose from.

But the coin-operated phonograph proved popular, reportedly earning Arnold and Glass about $1,000 in its ...

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