Anthony J. Pennings, PhD

WRITINGS ON DIGITAL ECONOMICS, ENERGY STRATEGIES, AND GLOBAL COMMUNICATIONS

How IT Came to Rule the World, 1.9: Xerox PARC

Posted on | August 26, 2010 | No Comments

A major, but a transitional step for personalized computing and data networking occurred at Xerox, the paper copier megalith. Xerox appropriated much of the research work done at the Augmentation Research Center (ARC) and the Advanced Research Projects Agency (ARPA) for their new research center situated in northern California. The Palo Alto Research Center (PARC) was set up by Xerox in 1970 to establish leadership in the “architecture of information,” a vague but enticing term coined by Xerox CEO Peter McColough.(1) Drawing on Xerox’s great wealth, PARC harvested the fruits of ARPA’s continuous funding by hiring one of their former directors and by recruiting some of computer science’s top researchers. At PARC, Xerox developed the Alto and the Star, early personalized computers with a GUI interface, mouse, and even Ethernet data networking. These PARC innovations inspired companies like Apple, Cisco and 3Com to develop new technologies like the Macintosh PC and data routers.

Deeply implicated in the development of the Great Society’s new bureaucracies, Xerox achieved extraordinary growth and profitability during the 1960s. Formerly the Haloid Company, the firm became Haloid-Xerox in 1958. The next year it launched the Xerox 914, the first automatic, plain-paper office copier and considered one of the most popular industrial products of all time. It subsequently saw its annual profits increase from $32 million in 1959 to over $1.1 billion in 1968.(2)

When Xerox went public in 1961, it became one of the hottest stocks of the year. The Xerox name was so strongly tied to the copying process that the term “Xeroxing” became synonymous with paper reproductions. Just as people “Google” information on the web, they would “Xerox” a paper copy of a document. During the 1960s, Xerox maintained a sales force of some 15,000 people to maintain contact with the new bureaucracies and attempt to solve their customer’s every information need. Xerox was aiming at revenues of $10 billion by 1980 and saw computer-related technologies as a key ingredient in the recipe for reaching that goal, especially after it began to encounter serious competition in their major product lines from the Japanese.

Xerox set out to develop a strong presence in the computer field and recruited some key talent from ARPA and ARPA-funded projects throughout the country. ARPA had been literally creating the field of computer science during that time by seeding programs throughout US universities, and their “talent” was prized and sought-after. Xerox also sought to enter this emerging field through acquisitions. In one of their first attempts, they bought Scientific Data Systems (SDS) in 1969. SDS was a small computer company, but with impressive sales. The new purchase was successful with batch processing for scientific and engineering applications but proved to be slow to capitalize on timesharing developments. Ultimately SDS personal ran afoul of Xerox’s new computer elite from ARPA, who were much more committed to developing an interactive “timesharing” computing environment based on apportioning a computer’s processing time via remotely-located stations. The “dumb terminals” connected a user to a major computer via data communications and allowed a single mainframe to service many people at the same time.

A key person in helping to achieve the Xerox plan was a former director of ARPA’s IPTO. Robert Taylor had resigned as the director of ARPA’s main computer division over concerns about Vietnam and ended up at PARC to help them recruit the brightest people in the computing area. Taylor had worked under Licklider at ARPA and had funded many projects including Robert Engelbart’s NLS project. He had even hired Larry Roberts, who coordinated the ARPANET project. Taylor’s background at ARPA proved instrumental in Xerox’s new plan. He was in a key position to reap the rewards of ARPA’s widespread funding. Subsequently, he hired a number of computer stars from the ARPA universe including those from MIT, Harvard, Carnegie-Mellon, the University of Utah, as well as BBN. He was particularly interested in those that had worked for Project Genie, a project at the University of California at Berkeley that had converted a SDS batch-processing computer into a time-sharing utility. Taylor had parted ways with Xerox management after refusing to use SDS computers in their research environment. PARC wanted DEC’s PDP-10, so it could run ARPA’s time-sharing software or develop its own. In the end, the SDS acquisition became a failure.

Drawing on ARPA’s network of computer expertise, PARC contributed significantly to the future of data communications. Robert Metcalfe, left his studies at Harvard to spend some time at the University of Hawaii with the ALOHANET project so he could study data networks. There Metcalfe picked up crucial ideas on packet-switching and collision detection from Engineering Professor Norm Abramson that would prove useful in his Ph.D. dissertation and later for innovations at PARC. Concepts emerging from the ALOHA project were extremely important for the future of data networking technology. These concepts led ultimately to Xerox’s local area networking products called Ethernet (and even later a company called 3Com). While the ARPANET had solved certain issues related to long distance data communications, Ethernet tackled short-range communications needed in an office or campus environment.

Here is a later blog responding to an article in the Wall Street Journal overemphasizing PARC’s influence.

Notes

(1) Xerox CEO Peter McColough’s speech went: “The basic purpose of the Xerox Corporation is to find the best means to bring greater order and discipline to information. Thus our fundamental thrust, our common denominator, has evolved towards establishing leadership in what we call “the architecture of information.” From: Fumbling the Future: How Xerox Invented, Then Ignored, The First Personal Computer, by Douglas K. Smith and Robert C. Alexander. NY: toExcel Press. p. 50.
2) Segeller, (1999) Nerds 2.0.1: A Brief History of the Internet. New York: TV Books. p. 158
3) Ibid, p. 130.

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Anthony J. Pennings, PhD recently joined the Digital Media Management program at St. Edwards University in Austin TX, after ten years on the faculty of New York University.

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    Professor at State University of New York (SUNY) Korea since 2016. Moved to Austin, Texas in August 2012 to join the Digital Media Management program at St. Edwards University. Spent the previous decade on the faculty at New York University teaching and researching information systems, digital economics, and strategic communications.

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