Answer: A Coffee Pot
The first webcam, like many inventions, was built to save time. Back in the 1990s, the Computer Laboratory at the University of Cambridge had a rather inconveniently located break room, known to faculty and students as the Trojan Room. In 1991, Quentin Stafford-Fraser and Paul Jardetzky collaborated to put an end to the frustration of trudging across the entire building to the Trojan Room only to find out that the coffee pot was empty. Using the X-Window System protocol, they wrote a client/server model that broadcast a simple low-resolution video feed of the coffee pot over the local network.
Two years later in 1993 when early web browsers adopted in-line image display, the camera setup received an upgrade. Daniel Gordon and Martyn Johnson connected the camera via streaming server to the Internet; it began serving up live shots of the coffee pot at the rate of one frame per second. Although checking to see if a pot of coffee was full or not might seem like a trivial thing to modern media-saturated Internet users, the Cambridge coffee pot was one of the most visited websites on the early Internet.
The coffee-cam remained online from 1993 until 2001 when the computer department moved to new facilities.
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Source: How-To Geek