Posted by Tom Foremski - March 6, 2008
Tuesday I had dinner with Sophie Vandebroek, CTO of Xerox and Scott Elrod, who heads up the hardware laboratory at the Palo Alto Research Center (PARC.)
PARC is famous for developing many of the personal computer technologies we take for granted such as the graphical user interface, laser printer, ethernet networking, object-oriented computer languages, and many other advances.
PARC is also infamously known for an inability to commercialize its technologies, allowing Apple, and others, to build large businesses based on its computer technologies.
PARC spun out...
In 2002 Xerox spun out PARC as a wholly owned subsidiary. "PARC was spun out so that we could harness the entrepreneurial spirit of our staff. When you hire exceptional people you don't want to narrow their focus on technologies that are just useful for Xerox," says Sophie Vandebroek, CTO of Xerox. "You want to be able to allow them to find commercial opportunities in adjacent sectors."
PARC has been inviting VCs to learn about its technologies and it has also been bringing in visiting experts in areas such as solar cells, and manufacturing, to help its researchers create commercially viable products.
"The visiting experts program has been very good for us. They work with us for about 6 months and it is a short cut for us." says Mr Elrod. Xerox continues to be PARC's largest customer but about 50 per cent of its revenues now come from other customers.
PARC has about 170 researchers and is almost profitable, says Scott Elrod, who heads the hardware labs, one of four laboratories at PARC. One of the recent innovations from PARC is an ability to increase the efficiency of solar cells by printing fine wire connectors.
"In solar cells the electrical wires that connect the cells prevent sunlight reaching part of the cell. By printing finer wires we can increase the efficiency of solar cells by as much as 8 per cent," says Mr Elrod. "We are also incubating several startups at PARC and have one successful startup, SolFocus that has already raised $80m in funding."
Cleantech is a big driver for innovation at PARC. For example, it has technology for producing clean water, and for managing and coordinating the production of large print jobs. This technology is now being applied to IT data centers to power up and power down systems as needed.
PARC also has 1800 patents and is planning to go after companies that are using its intellectual property. It is targeting companies in the laser and electronics manufacturing industries, preparing patent infringement actions against them.
Xerox has gone through a major restructuring of its business groups over the past few years. But it has sought to maintain its research centers in Rochester, in Toronto and in Grenoble, France.
Xerox has also been acquiring companies for their technologies, such as Amici, Global Imaging Systems, and Advectis. "We have been using some of these technologies in-house. For example, the Amici technology is used in e-discovery for legal documents, it can understand the content. We use this to help our researchers find relevant documents and comments within our organization," says Ms. Vandebroek.
She says that Xerox strives for two types of innovation: sustained innovation that improves the performance of its products and services; and disruptive innovation that changes the landscape of industries.
Additional info for Xerox:
2007 Revenue $17.2 billion
2007 Income $1.1 billion
2007 Earnings Per Share $1.19 per share
2007 Commitment to Research, Development and Engineering $912 million, or about 5 percent of revenue
Employees As of year-end 2007: 57,400 worldwide
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