Edison realized that he could record telephone messages "while working on a machine that would inscribe telegraphic messages through indentations on paper tape" in 1877. This led to the idea of the phonograph. "He experimented with a diaphragm which had an embossing point and was held against rapidly-moving paraffin paper. The speaking vibrations made indentations in the paper." After the project proved a success by replaying the word "Mary had a little lamb", Edison filed for a patent on December 24, 1877. Edison improved the phonograph several times by changing the cylinders inside to various materials. Although Edison had intended his phonograph to be used in business-type work, it revolutionized entertainment today. Firstly, Edison insisted that he (deaf as he was) was to choose the bands that would record in to the phonograph. Despite his attempt to hold absolute control over the device, he was drowned by others who would have their music played aloud. With the phonograph as a basis, record-players were later developed following Edison's concept of replaying sounds. Edison's phonograph ultimately revolutionized modern-day entertainment.

References:
1) http://memory.loc.gov/ammem/edhtml/edcyldr.html