Larry Tesler talks about Steve Jobs’ trips to Xerox’s Palo Alto Research Center, including the one where Jobs eyed the company’s graphical user interface prototype — which ended up on Mac OS.

Introducer: Larry Tesler, I believe you took Steve on a tour of Xerox PARC and showed him some technology that became important. I wonder if you could tell us about that that tour?

Larry Tesler: Well it wasn’t the physical facility. It was a tour of the software it was part of that demonstration . Xerox was facing a lot of competition from Asian companies in copiers when their patents expired and one thing they found was that they had a very high manufacturing cost and they were really having trouble competing with these new forces in the market.
At the same time they had Xerox PARC, developing very exciting technologies including the Ethernet, GUIs with windows and improved mice from what existed before.

They started worrying that they would not be able to manufacture those cheaply enough when they moved into that market. So they looked around and saw that Apple was cranking out Apple ][s for really cheap and selling lots of them and they thought, “Well, we should partner with a company like Apple and they’ll make our machines for us”. Or something like that. Xerox had some kind of idea of [that] type, so some business development peope came from the East Coast to PARC and when they got to Apple they made a deal where in exchange for various business arrangements, distribution and future discussion of manufacture and so on, Apple would sell them stock. This was a very appealing thing because it was very clear Apple was going to have a very successful IPO, […] and in exchange though, Steve Jobs required information… disclosure, everything cool going on at Xerox PARC [laughter] [voice commenting “Good bargain!”]. Nobody checked with the PARC people first but the business development people signed the deal.

So there was a number of visits [by Apple to PARC]. I was involved in a couple of them. One was [Apple] executives visiting and meeting with some of us [PARC researchers] trying to just get information out of us or an agenda for how to get the information out of us.

That was a little bit of a tense meeting but I remember at one point Steve was pacing the room trying not to be in charge of the meeting because he was not the CEO of the company – Mike Scott was – and at one point he just said “Stop! Stop! Stop! Stop! Stop this discussion! We need to tell them about the Lisa!” and all the Apple people kind of froze… “Come on! Come on, we need to tell them about the Lisa! This conversation is gonna go nowhere!”. So we got perked up, because it was us disclosing to them, not them disclosing to us, but finally they threw up their hands “OK, tell ’em about the Lisa!” so somebody told us a little about the Lisa, which at that time did not have a GUI but it was powerful enough to do the kinds of thing that they thought we were doing.

The next thing I remember was another meeting where apparently Apple people had been demoed in-between but they weren’t satisfied with the demo. They knew there was lot more than [what] we were showing them. There were a lot of people at PARC that didn’t want to show Apple everything. And in fact we all felt like we didn’t want to show them everything, but I was one of those who felt we should show them more. There were people who wanted to hold back everything we could.
So they arranged a new set of demos, where more people came, Bill [Atkinson] was there, John Couch, Mike Scott, obviously Steve, Jef Raskin, [and] a couple of other people.

The room as pretty full and there were two or three of us from PARC at a time, one person sitting at the computer, getting the demonstration and the other people waiting their turn or observing. So, during that demo, Steve again got very excited. He was pacing around the room and occasionally looking at the screen. he was mostly just looking and reacting and taking it all in, trying to process it and at one point he said “You’re still not showing us everything!” And the meeting paused, there were some phone calls [made], and [then] “OK, we’re going to show you more.” [laughter]

So I gave my demo, then Dan Ingalls gave a demo for Smalltalk and they started asking us lot of questions. Bill and, Bruce Daniels was there too, he had joined Apple from MIT… those technical people just asking us questions and we were answering the questions and frankly I was amazed.

I had looked into Apple earlier, a couple of years before, because someone tried to get me to work there, and I found these people who were Homebrew Computer Club kinda hackers. Suddenly there were all these computer scientists in the room and they were asking really good questions! So I got a completely different view about what Apple was like from that meeting. But Jobs was saying “What is going on here? You’re sitting on a gold mine! Why aren’t you doing something with this technology? You could change the world!” And his buddies, who were trying to arrange the negotiation of some kind, were trying to quite him down [laughter] “Don’t be so excited!” But it was really clear to him that we [at Xerox] were never really gonna do anything with this, and by that I mean the kinds of revolutionary things that he was envisioning.

The irony was that when they left we still had shown the like only 1% of what PARC was doing but it was enough that they got really excited and decided they were going to retarget the Lisa to be something like what they had seen, in terms of GUI. They fell in love with the mouse and that changed everything. And seven months after I was working at Apple.”