PARC: Then, now and tomorrow

Many research examples, like smart documents seem to focus on enterprises. Is research being geared toward consumers too?

Vandebroek: It depends. The research is often applicable to both. Within Xerox, we are geared towards small and medium business like a law firm and hospitals to very large global enterprises. However, the intellectual property can be used for end consumers. In fact, PARC just supported a spin-off, Powerset, with some of our core technologies.

Bernstein: Understanding the meaning of words and phrases through linguistic applications is a technology that's at the core of Powerset's search facility. It's focused on consumer search, but rather than Google, which uses keyword matching, you just simply ask a question and it understands by the context of the phrase, disambiguates the meanings and gives you the information you are looking for. It was originally developed to facilitate translation of meaning -- not just words -- of documents from one language to another. The technology now is being used for other purposes around content.

With the economic downturn, research labs like HP's are cutting back operations. There is pressure to reduce costs. What is the future of research labs?

Vandebroek: I do believe in innovation -- you have to continually refresh your products and services. Back in 2000 when Xerox was going through very difficult times -- we were losing money -- [Chairman and CEO] Anne Mulcahy and the senior team turned the company around. She got a lot of pressure also at that time ... [to] cut more R&D. Her statement, which I strongly believe is held across the company, is 'how can I rescue it today and jeopardize the future?' If you don't invest, you have no future of new products and services. In the last three years we launched over 100 new products and services and it's our intention to keep doing that. We are not cutting R&D at all. The beauty of PARC's model, of course, is to be able to reach to clients across the world.

Bernstein: In the last 15 years, there's much less basic research being supported by the government. Much of that has to happen in academia. I think the other side of that is what research is intended to accomplish and the value that comes back from that accomplishment. HP was, I thought, being very explicit, saying, 'We've got too many little things and not a critical mass. Tell me what the most important opportunities are that you can identify? How are you going to staff them at a level that's at critical mass and is going to make a difference. Where are your big bets? Let's be clear about them and let's resource them to be successful.' Sophie and Xerox are absolutely addressing the same kinds of issues.

You developed a lot of the technology that we are now seeing. What is the future of PCs?

Bernstein: Mobility is where things are headed. I think you are going to see the proliferation of devices for particular purposes. You'll see more generic platforms where the client will be rather thin. As soon as we get to ubiquitous connectivity at a reasonable bandwidth, then you'll see more of a computational horsepower being borne by the network and that there will be a whole array of different applications -- hopefully, not just Microsoft applications -- that we will have access to. The notion of computation generally is it's going to be less focused activity and more how we live, the computation would recede into the fabric of our lives and help us work and play. That hasn't happened, but I think that is what is going to play out as the network gets smarter and is able to help us do things that it knows we need to be attending to.