The file
A talking bear with a tape deck in his back. Teddy read you a story from a cassette while his mouth and eyes moved, and it was the best-selling toy of 1985 and 1986. He came with an animatronic sidekick, Grubby, who plugged into him with a cord.
The tapes wore out, the eyes started drifting, and eventually he read the story with his mouth slightly out of sync, which was somehow scarier than not talking at all. Worlds of Wonder went bankrupt by 1988; the bear outlived the company.
Sources: Wikipedia — Teddy Ruxpin