Xerox Shows Off Future Tech And Tries To Better Define Itself

At the Palo Alto Research Center, the past is present: Horses graze amid tall grass on Coyote Road, as if to remind visitors of Silicon Valley before the silicon age, of the Old West and the pioneer spirit that's still evident in many of California's current innovators.

The past is present at PARC -- formerly Xerox PARC, but spun off as a wholly owned subsidiary of Xerox in 2002 -- quite literally: The lab is littered with reminders of innovations created by its researches. These include the laser printer, Ethernet networking, and the graphic user interface for computers.

Yet this past is something of an albatross that hangs about the necks of both Xerox and PARC. This was apparent on Tuesday at "Inside Innovation at Xerox," a media event held on Tuesday at PARC to showcase technologies that may soon emerge from the lab, such as self-erasing, reusable paper; a technique for rare cell detection; and more environmentally friendly plastics.

During a discussion with Xerox CTO Sophie Vandebroek, Forrester Research VP Laura Ramos observed that Xerox was well-known as an inventor but that other companies seemed to commercialize its technology. (Like the publishing companies that passed on the original Harry Potter manuscript, everyone at Xerox is probably tired of being reminded how Apple and others took its ideas to market.)

Xerox, as a company with $17 billion in revenue in 2007, hardly has to apologize for itself, but after years of lackluster stock performance, there's a sense that the company needs to clarify its positioning, particularly as Amazon, Google, Microsoft, and Salesforce.com, among others, redefine software as a service and IT infrastructure as a platform.

Ramos and other Forrester analysts at the event pressed Vandebroek to clarify Xerox's vision and identity. "They do have something to demonstrate to the market," said Ramos in a phone interview. "What does this innovation mean in terms of building shareholder value at Xerox?"

Vandebroek presented three pillars of growth for the company: driving the color printing revolution, creating a new business around offset printing through mass customization (ever wanted to print your own pop-up book?), and offering services to simplify document-intensive processes.

Two such Xerox services are Xerox Litigation Services (XLS) and Xerox Mortgage Services, which help law firms and mortgage industry companies bring offline information online and manage information that's already in electronic form.

These services are without a doubt innovative -- XLS for example features a conceptual search technology that will "actually help you decide what to search for," as Chris O'Brien, COO of XLS, put it -- but they also are the result of acquisitions. XLS grew out of the 2006 acquisition of Amici, and Xerox Mortgage Services emerged from the 2007 acquisition of Advectis. Thus, these two services, while they may drive revenue for Xerox, aren't the best examples of what innovation means at Xerox.

Innovation isn't only a matter of corporate profits. It's valuable to society at large because advances in one field often lead to unexpected advances in another. So it is that Xerox's printing advances over the years may end up improving health care.

The Scripps-PARC Institute for Advanced Biomedical Sciences, a partnership between Scripts Research Institute and PARC formed in 2002, has combined laser printing technology with fiber optics to create a way to identify rare cells, such as cancer cells, in the bloodstream about 1,000 times faster than digital microscopy. The technique could lead to more effective cancer treatment. It could also help reduce miscarriages by providing a noninvasive substitute for amniocentesis, a diagnostic procedure employed during some pregnancies.

Such partnerships serve to underscore that PARC is an independent organization, one that is helping organizations other than Xerox innovate. That has some tangential value to Xerox, as PARC's owner: Good publicity may rub off. But PARC isn't just serving Xerox by inventing technologies for outside organizations. It's also investing technologies that could drive revenue at Xerox.

One of the more promising technologies demonstrated at Tuesday's event was self-erasing, reusable paper. The paperless office, said PARC researcher Eric Schrader, "is something Xerox worries about a lot." But as Schrader pointed out, Xerox needed worry because "people love paper." They love it so much that they're willing to waste it needlessly: 44.5% of documents are printed for one-time use, according to Schrader.

It takes 204,000 joules of energy to create one sheet of paper from virgin pulp, explained Schrader, which is the equivalent of a 60-watt light bulb illuminated for an hour. Producing one page of recycled paper takes about half as much energy. But either way, that's a lot of waste in terms of energy and materials just to print something that will be thrown away after a single use.

Though initially a bit more energy intensive to produce, a page of the self-erasing, reusable paper Xerox and PARC have developed requires only 1,000 joules to print with 10% coverage. The ink fades after about 24 hours.

Schrader said that further work needs to be done before the technology is commercialized, such as determining whether faded words can be made legible using a microscope or some other technology. But such innovation, once refined and properly brought to market, could significantly enhance Xerox's business and its image. What's not to like about 90% less waste?

In keeping with its roots in printing technology, Xerox researcher Rob Rolleston demonstrated a prototype called Document Production Visualization. The system offers WYSIWYG print production. It encompasses not only document page layout, but printing and finishing.

Rolleston demonstrated how a book project might visualized to show binding options and how 3-D printed marketing material -- the kind that requires cutting and folding -- could be easily visualized and produced. Using such a system, one could create, say, a pop-up book or offer consumers the ability to design complex birthday cards with multiple folds. "It's mass customization taken to the extreme," he explained.

Xerox used to refer to itself as "the document company." But documents have undergone profound changes as they have migrated online, and they continue to do so. Documents are different for different needs and different media now. Xerox faces the challenge of addressing those needs through services that define document presentation and distribution inside and across organizations. Perhaps what it needs, as a Forrester research director suggested, was to buy a business process management company.

While "Inside Innovation at Xerox" didn't entirely clarify how PARC's work would lead to happier Xerox shareholders, it did serve to illuminate the company's potential and its pioneer spirit.