Pioneers in Science and Technology Series: David Packard

              
PIONEERS IN SCIENCE AND TECHNOLOGY SERIES


ORAL HISTORY OF DAVID PACKARD
Interviewed by Clarence Larson
Filmed by Jane Larson
March 15, 1984
Transcribed by Jordan Reed 
MR. PACKARD: I feel a little humble claiming that I have made any important contributions, but I certainly have had a very interesting life because I became interested in radio. In the early days we didn’t have any such thing as electronics, it was radio and wireless, as perhaps you recall. I became interested in radio when I was still in grade school as a matter of fact. I was born and brought up in Pueblo, Colorado, and somehow I was intrigued with the development because if you recall the radio broadcasting began to become established in the early 1920’s.
MR. LARSON: Yes, I remember that very well.
MR. PACKARD: I was born in 1912, so I was about 10 years old when some of these radio broadcastings became established. I think the first experience, my father bought me a vacuum tube and I hooked it up on the dining room table. The first station we got was WHO from Des Moines, Iowa. That was about 1922, ’23, when I was 10 or 11 years old. So my interest in the electronics field began early and I really stayed with it. I became a radio amateur while I was still in high school and as you know radio amateurs were involved in sort of the fringes of radio development industry and actually made very many contributions over the years and I still now and then run into someone around the world that I talked to when I was a radio amateur back in my school days in Pueblo, Colorado. I guess the most important factor that influenced the course of my career was the fact that I came to Stanford University in 1930 and took a course in what was then electrical engineering. Dr. Fred Terman had come to Stanford. A few years earlier he had graduated from Stanford and I think he got his doctors degree at MIT in mechanical engineering, but he had also been a radio amateur and he became interested in radio engineering and wrote what became I think, that most people would say, was the first most important textbook in the field of radio engineering which was published in the 1930’s and I think it was studied by every student of radio engineering and electronics in the period from the mid 1930’s up to about 1950.
MR. LARSON: I think I have a copy of the 1940 edition.
MR. PACKARD: Anyone who ever had any involvement in radio or electronics through that period had that book. Fred Terman was a very interesting person and I was very fortunate to have the opportunity to become acquainted with him. He stopped me in the hall one time while I was a junior and I use to get over to his laboratory because he had an amateur radio station at Stanford. I was involved in working with that and it was through that involvement that Dr. Terman came to know about me and it turns out that he realized I was interested in radio and that I also had taken most of the other courses necessary in electrical engineering and so he offered to let me take his graduate course in radio engineering which was based on that textbook. I was the first one to, the first undergraduate that was allowed to take that course and so during my senior year I attended his graduate course and that, of course, really reinforced my commitment to want to spend my career in the field of radio engineering and electronics. 
MR. LARSON: I’m very happy to hear you mention Dr. Terman because I know my son has said without Dr. Terman there might not be a Silicon Valley. 
MR. PACKARD: He was very influential. I might tell you a little bit about that because in the course of his interest in radio engineering he became acquainted with almost all of the people who had been pioneering in the industry, many of whom are right around this area because there was some early work done by some Stanford graduates going clear back to the beginning of the century and the Federal Telegraph Company was established here in Palo Alto [California] based on the Poulsen Art Patents which were obtained from Denmark by a Stanford graduate in, by 1905, I believe, and then you know Dr. [Lee] De Forest invented the vacuum tube here in Palo Alto in 1908. 
MR. LARSON: I had forgotten that that originated in Palo Alto.
MR. PACKARD: Oh yes. And then Dr. Fitz Colster developed the radio direction finder in the 1920’s. He lived in Palo Alto and the Jensen loudspeaker was the first dynamic loudspeaker and that company was established in Oakland.
MR. LARSON: I think I have an old model of the Jensen still on my shelf.
MR. PACKARD: Then Philo Farnsworth at that time was doing his work on the picture tube for television.
MR. LARSON: Oh yes.
MR. PACKARD: In the course of this study with Dr. Terman in radio engineering, he arranged visits for his students to go around and visit these companies and this was a very intriguing experience because we visited Charlie Litton who started a company up in Redwood City to build vacuum tubes, but he ended up concentrating his work on vacuum tube manufacturing machinery, glass blowing lathes and so forth.
MR. LARSON: Oh yes. I remember the famous Litton glass blowing lathes. In fact I used one.
MR. PACKARD: That was his contribution and we visited Farnsworth’s research project. It was up in San Francisco at the time and this was during the Depression and as we came along toward graduation in the spring of 1934, there was some concern about whether we would have a job. Bill Hewlett and I became friends as freshmen at Stanford because we were both taking the same engineering courses and so we’d been in courses together from, for the three and a half years or so. 
MR. LARSON: Was Mr. Hewlett also involved in amateur radio? 
MR. PACKARD: No, Bill Hewlett was not involved in amateur radio. And a matter of fact he had very little interest in radio until we got acquainted. He had been interested in other things. But he developed his interests again really under the influence of Dr. Terman. But in any case, Bill and I had talked about the possibility of starting a company ourselves. We talked about this in the fall of 1933 when I was first taking his courses here. Fred gave us a little encouragement. He said, unlike a lot of these people who started these companies here that have been very successful, didn’t have very much formal education in radio engineering and said that you and Bill have had more formal education and there is no reason why you wouldn’t be more successful. Well we weren’t quite sure, but in any case we were fully committed to the proposition that if we didn’t get a job that was satisfactory that we would undertake to do this ourselves. I was fortunate enough to get an offer to go to work for the General Electric Company, being one of the very few jobs that were available in those days; it was too much of a temptation for me to give that up. So I agreed to take that job and went back to Schenectady, New York, in the spring of 1935.
MR. LARSON: Yes. As a matter of fact I went through the same Depression years and about then, there were about 100 applications for every job.
MR. PACKARD: Oh yes. So I felt quite fortunate to get a job at General Electric and I think they hired two or 300 graduates at that time from all over the country. So I went back to Schenectady and one interesting observation I made about that, when I got back to General Electric, my advisors recommended very strongly that I not get involved in electronics. They didn’t think there was going to be any future in electronics and they thought if I was going to be a successful, have a successful career in electrical engineering I ought to concentrate in power generation, motors and some of those things. Well I didn’t agree with them and so I went around myself and found an opportunity in the Vacuum Tube Engineering Department and it turned out that the advisors would help you get a location that you might be interested in, but you could also go around yourself and find something to do, which I was able to do. So I spent most of my time, I remained there until 1938 in the Vacuum Tube Engineering Department. We were working on mercury vapor rectifiers and nitrons, but it was a very interesting experience because this vacuum tube engineering group was located in the same building as the main research laboratory in Schenectady, New York, so I had a chance to be exposed to some good many distinguished scientists and people working on interesting things. I had a little benefit of that acquaintance. 
MR. LARSON: Yes, I believe wasn’t [William] Coolidge with General Electric Company.
MR. PACKARD: Yes, Coolidge. It was [Robert] Hall, and Coolidge, and [Irving] Langmuir.
MR. LARSON: Oh and Langmuir, of course.
MR. PACKARD: All made very important contributions in the theory of vacuum tubes and General Electric was involved in the manufacture of some radio type vacuum tubes and they were making some large water cooled anode tubes and transmitting tubes there at the department. But during this period, Fred Terman kept in touch with me and as a matter of fact he would quite often travel to the east and visit his former students and there were a good many of his former students that had jobs in the various electronic industries there. A number of them at the Bell Labs, at RCA and there were several at General Electric. Bill Hewlett decided to do some graduate work, so he came out to MIT. Several times Bill and I would get together, we would go skiing together and sometimes he would come over, so we continued some discussion about this idea of eventually starting our own company during this interim period. Well, I got married in 1938, a young lady that I met at Stanford and in those days I couldn’t afford to come back to San Francisco to get married, so she got on a train all by herself and came out to Schenectady and we got married in the spring of that year. In the summer of 1938, Fred Terman worked out a research opportunity for me to come back to Stanford and he recommended that I do that and take some additional work and he said that the combination of what I had done at General Electric and I did a little bit of graduate work at the University of Colorado, he said that I could get engineering degree, it was a double E degree in one year residence instead of the usual two years of residence. So we arranged to come back and I had a very interesting project to work on, an idea that Russ Varian had which was a way of hopefully reducing the grid loss in a triad at high frequencies. Fred Terman had arranged so that I could do this work up at Charlie Litton’s laboratory because it involved measuring one of these tubes to see whether it would work or not.
MR. LARSON: Oh yes. That’s amazing because it was just about that time when a need for high frequencies was beginning to develop. 
MR. PACKARD: That’s right. And of course the work on the klystron was being done over at the Physics Department over at Stanford and there was a recognition that microwave would be very important for radar. This was already known and there was work being done in various areas. So there was quite a bit of emphasis on the development of better high frequency technology at that time. Well, in any case, I took some courses and Bill had found an apartment down on Addison Avenue, which is actually still there, with a garage, so we set up a little shop in this garage and we would go to class in the morning and we’d do some work in the garage on some of our, we’d try to develop some things for our potential business and then after dinner I would go up and work in Charlie Litton’s laboratory. This worked out fine because of, he felt it was a waste of time to spend too much time in the office during the day, waste his time with phone calls and so forth so he wouldn’t get started until maybe the middle of the day, but he’d work until 2 or 3 o’clock in the morning. So I would go up there and quite often work until midnight, 1 o’clock, and I was young enough then I could keep up with all of these things. 
MR. LARSON: That’s a fascinating story because that was such an important development, the development and the invention so forth came at about the right time in history.
MR. PACKARD: It’s just quite often a matter of luck that you happen to be at the right place at the right time and I think that Bill Hewlett and I just happened to be involved in this industry at a time when it was really beginning to take off. Well in any case, Bill had developed a new kind of audio oscillator in his laboratory work over at Stanford. Fred let him continue some work over there even after he completed his studies, just to sort of help out a little bit and they had a very interesting group of people and they were working primarily on ideas of applying the feedback principal to various applications. Feedback had been combatted by, a lot by the Bell Labs people. I think about 1928, but it usually takes a little while for these new ideas to become known and to become utilized. So in 1938, they were still talking about how to utilize this feedback principle, 10 years after it had been invented. It had been about that time a lot of practical applications were discovered. In any case, we built one of these oscillator models, one of Bill’s ideas and he took it up to the IRE in Portland in 1938 and it received quite good acceptance. People were interested in it. With Fred’s encouragement, we decided that we would use that to try and start our business. So I still recall it was around Christmas time and we had this audio oscillator in the living room. We took some pictures of it and wrote up some sales specifications and Fred Terman had given us a list of some potential customers and we got lists from a few other customers and right after the first of the year we set out these letters offering this audio oscillator to a number of people. 
MR. LARSON: Yes, as I remember at that time the ordinary audio oscillators were very cumbersome and not very satisfactory.
MR. PACKARD: Well, they used a beat frequency principal and the oscillator that was a standard was one made by General Radio, cost about $500 and it was a big machine and not very stable in low frequencies and this circuit that Bill devised we made for less than $100 and in many ways it performed better than the General Radio.
MR. LARSON: Yes. 
MR. PACKARD: It was a real good contribution. In any case, shortly after we sent these letters out, we got some orders back including some checks with them for the product. So that’s really what got us started and by the end of that spring term, I had to make a choice of whether to go back to General Electric or not because I had been given a leave of absence. General Electric at that time, in the fall of, in the spring of 1939, beginning to be involved in a little bit of defense work and realized that there was some important things to be done so they, Mr. White who had been my boss in the department wrote me a letter encouraging me to come back, but I decided we would stay and make a run for it, which we did. So that’s really how we got started. Now, Bill and I decided about that time that it would be desirable for us to have several products that were complimentary. Obviously if you make a sales call on a customer if you have two or three things to sell it would be better. Beside that an audio oscillator was used with two or three other kinds of instruments to make the amazements you wanted to make which would be the frequency response and the sourcing that would be generated by the equipment you were testing. So we proceeded to develop some equipment that would analyze the wave form distortion including an automatic wave analyzer using the feedback principal and then subsequently a vacuum tube volt meter and some attenuators and so forth. So we then developed a package of equipment that a laboratory or someone could use to measure their audio equipment that they were making. This really limited product line had gotten fairly good acceptance by 19, well about a year or so after we got started. We had a few instruments that became quite important in the defense effort. So our business began to pick up relatively quite well at that time. Bill Hewlett had a reserves office commission in the Signal Corps so he was called to active duty and I think he was called before Pearl Harbor. I was able to get in touch with his boss and convince him that Bill had an important job to do back in Palo Alto and they let him come back, but then Pearl Harbor came along and he had to go back to the service. So I continued to run the company for the next two or three years while Bill was away.
MR. LARSON: So you were able to furnish many of these instruments for the defense effort then.
MR. PACKARD: Yes. Well as a matter of fact there was a great deal of concern in Washington as to whether or not there was going to be an adequate number of instruments to support the defense effort and I was invited to become a member of an advisory committee to the Department of Defense. It was, well it was a war production board related activity and an interesting story that I’ve often told about that. I became quite disillusioned about the ability of the federal government to know what was going on as a result of that experience. They invited a number of us to come back there and they said that they had a list of the quantities of the various instruments that they thought that they were going to need and what would need to be done to get the industry to gear up and manufacture these. Well we all looked at this list and were all in the same amazement because we were already producing much more in every category than they had on the list.
MR. LARSON: Oh yes.
MR. PACKARD: So they finally decided that the best way to handle this was to recognize that the instrument industry was important and that they would provide us with the critical materials with some priority and then we could build whatever quantities were needed by the industry. So it worked out to be a very satisfactory arrangement. Our products were originally involved in such things as, well, the proximity fuse production used our audio oscillators, part of it, and we supplied a lot of our audio equipment to various aspects of the defense industry. We also became involved in some microwave work at that time. I had called on the Naval Research Laboratory a number of times to sell our products and became acquainted with some of the engineers and scientists there. They had been doing some very interesting work in the development of microwave signal generators. We worked out an arrangement with them where we made some of these microwave signal generators and as a result we began to build some expertise in microwave amazement work. 
MR. LARSON: Yes. What frequencies did that cover?
MR. PACKARD: These started out at the three gigahertz range but there was some interest in all the way from 1000 megacycles. It was clear up to the X-band at that time and we did some, we eventually did some work in the whole area and it was a result of those initial contacts that we built up quite a little of capability in the microwave field and an interesting development after the war in its regard because the General Radio Company had been the main competitor. They were the big business in this little field that we were involved and they had done some work in microwave instrumentation, but for some reason they came to the conclusion that there wasn’t going to be any future for microwaves after the war and they let their work down and we were convinced that microwaves were going to be increasingly important. So we were able to hire half a dozen very capable people who had been involved in the instrument work during the war effort. Although our business was a little uncertain in 1946 and ’47, we were fortunate enough to get a good group of people together and to continue to develop some fairly good work in the field of electronic instrumentation. 
MR. LARSON: Yes, well really the future of the aviation industry I guess was critically dependent on good microwave and radar equipment. 
MR. PACKARD: Well it turned out that electronics was important in a number of industries and avionics. We start of course with communication which had been very well developed along the line by that time and then radar and then navigation so that then as you know electronics is a very important element for all kinds of avionic work. Our company didn’t, we were still quite small. In fact we had reached about a total of 200 people during the war and it was 1949, 1950 before we got back up to that level of activity again, a couple million dollars a year. So it wasn’t a large endeavor. Fortunately we had done some good work in building up a line of solid measuring instruments that in many cases were as good and in many cases better than anyone else had. So as the electronics industry began to pick up in the 1950’s, Korea had some impact on it, we were in a good position to expand with it. Our expansion really started in the early 1950’s when we saw the company build quite rapidly from that period on. 
MR. LARSON: What were some of those instruments that you brought on the market? Of course I can remember your oscilloscopes are so famous, but what others?
MR. PACKARD: Well as a matter of fact our contribution to the oscilloscopes wasn’t all that good. We had already made some good contributions to the audio field, some of which I already described. We continued working in that and we continued some developments on the microwave equipment and we had some good microwave signal generators that were broadband and very useful for anyone doing work in the microwave field. I think without any question we had developed the best line of microwave signal generators that were available at that time. Although there was competition and you always had to run to keep ahead of that, but we started another program which became very important and that was some equipment that would measure frequency using digital techniques so that you would get a digital frequency meter and read frequency directly instead of having to measure it by indirect means. This came about in a rather interesting way. We sponsored some research over at Stanford of two young people to look into the possibility of making some instruments for nuclear work, counters for nuclear measurement. They came up with some technology which would enable counters to operate at a 10 megacycle rate and measure with one cycle accuracy at that point. We concluded that it would be a much better opportunity to make a frequency meter that would be a direct reading up to 10 megacycles rather than to bother with a nuclear field. So we came out with the first frequency counter that would give you a direct reading of frequency input up to 10 megacycles.
MR. LARSON: And then your digital techniques?
MR. PACKARD: We used digital techniques so this would actually read out the frequency in the numbers directly with the accuracy of course determined by the accuracy of the time standard that was used because you had to count the number of cycles for a precise period and then measure them in that way. That was a very important contribution because it made frequency measurements much more accurate and could be done before with simple means and much more rapidly. These first high frequency counters we made were fairly large and complex and they weren’t too reliable, but they were so useful that they were very well accepted, even though the reliability wasn’t very good in the early stages. Then we had concluded in the very early stages of our activity that we didn’t want to simply be a [inaudible] kind of business. We wanted to try to find ways in which we could make a real contribution to the field we were in. One contribution that we made was a very important one, was simply to make a vacuum tube volt meter that could read a higher frequency and the limitations on the top frequency range you could use with the techniques which is simply use a [inaudible] to rectify the alternating current and then measure the DC as a measure of the amplitude of the alternating current. These were limited by the transit time of the electron flow in the diode; these were vacuum tube diodes that were used. Crystals had been used to some extent at that time as detectors and mixers for microwave work, but we weren’t able to get the stability and accuracy with the crystal detector that you would like to have. So we had [inaudible] develop a special diode for us, it was very closely spaced and this model 410, I guess was the number of it, was a high frequency volt meter that would go up to 700 megacycles, which was much better than anybody else.
MR. LARSON: That’s a tremendous jump in usefulness.
MR. PACKARD: So that became a very good instrument. When we, during the 1950’s we made quite a few good contributions as a result of our interest in this frequency measurement, we did a good deal of work on accurate quartz crystal controlled frequency standards. We brought a young man out from Colorado named Don Hammond who was one of the outstanding people in the country in working with quartz crystals. We were able to develop a more accurate and less costly crystal frequency standard and then Don and his team did some other very interesting things. They, in making a frequency standard you want to cut the crystal so that the frequency does not change with temperature and you do that by cutting at a certain axis in relation to the crystal structure. Now you can also find cuts where the frequency change will be maximized with temperature. From that we devised a way of using a quartz crystal as a quartz thermometer. It turned out that this provided a very precise measurement of temperature and so we developed the quartz thermometer using this crystal technology that we developed originally for an alternate purpose. A little later on we designed one, a quartz device that could easily be utilized to measure pressure. We’re still making those and they have a very important capability. They can measure pressures up to about 10,000 psi with a resolution of about 1 psi. So you can actually put one of these down a few thousand feet below the surface of the ocean and measure the barometric pressure at the surface with them. 
MR. LARSON: That’s amazing. Of course, the accurate measurement of pressure and temperature is a very useful thing in so many fields.
MR. PACKARD: Well these are being used now primarily in the oil expiration industry where they want to measure temperature in these deep holes and we make a special model that is used for that purpose. Then, as we began to round out our line of instrumentation, what we tried to do is to develop a broad line of what we call general purpose electronic instruments that anybody doing electronics would need to have. We were quite successful in doing this partly because we had concentrated on the field of instrumentation at the very beginning and as a result we knew a little bit about the business. We also decided, as I’ve indicated, that we really wanted to try and make some kind of a contribution to do something better. The combination of these things made it possible for us to get a broad line of these general purpose instruments in production by the end of the 1950’s. At that time, we began to look around a little bit to see what other things might be done with some of the technology that we developed and we concluded that some of this technology would be useful in medical instrumentation and we finally decided to acquire a company called the Sanborn Company that was located in Waltham, Massachusetts. They had been the pioneers in the electrocardiograph and that was sort of the pioneer instrument in the electronic applications to medical things. Bill Hewlett had kind of a special interest in medical instruments. First place, his father had been a doctor so he had been exposed to the medical profession to some extent and he’d also done some work for some of the doctors here at Palo Alto. In fact, one of the projects we worked on in the early months when I came back, he’d been working on this before, was an electroencephalograph which is an instrument that measures the electrical waves in the brain. So this field was one that we had an interest in and by acquiring the Sanborn Company this gave us another product line and opportunity to apply some of our technology. Then a little later on we also concluded that some of the things we were doing could be useful in making measurements in analytical chemistry. There had been already a number of instruments that were developed. Beckman had been doing some work in that field and the gas chromatography became quite important in the early 1960’s and we acquired a company that was in Avondale, Pennsylvania, just outside of Wilmington where some folks had done some work in the DuPont Laboratory and had established a company to make their gas chromatographs.
MR. LARSON: Yes, well, that field of application of instruments, did those fields that had chromatography and analytical fields revolutionized analysis both medical and chemical.
MR. PACKARD: As a matter of fact, we have made tremendous progress in this area and we’ve had the opportunity to be among the people at the forefront of this field. One of the combinations that have been particularly effective is the use of a mass spectrometer in combination with a gas chromatograph. These instruments make it possible to measure various chemicals in very small quantities, parts per million, and in some cases even parts per billion. I’ve often commented recently that we have a lot to do with all this environmental business because they couldn’t measure any of these things 20 or 30 years ago and so they didn’t worry about them because they didn’t know about them.
MR. LARSON: Yes. I guess sometimes we might even perhaps wonder if some of these things are mixed blessings.
MR. PACKARD: Well I think that’s quite right. In any case, the instruments that the company developed did make a very important contribution in that field of knowing more about what’s in the environment around us and this includes both air quality and water quality and as a matter of fact our instruments are being used in the Olympic games to check the athletes to see whether they are using drugs or not. So our instruments determine whether these athletes are qualified or not in the Olympic games in Los Angeles next year, and when we were in Moscow with our equipment last time. So we have had the opportunity to concentrate on this field of trying to make better instruments using electronic technology and it’s been a very exciting business because although none of these are tremendously widely known breakthroughs in themselves, they have I think made useful contributions to a lot of scientific progress during the last 20 or 30 years.
MR. LARSON: Yes. Well of course instrumentation all the way from the invention of the microscope, science builds on instrumentation. The whole field of DNA and the unraveling of the large molecules depend on these instruments that weren’t available.
MR. PACKARD: Well, there has been a tremendous amount of work done in that field. Well, as we saw this field expanding in the early 1960’s, it looked as though there would be an opportunity to combine the digital computer technology with instrumentation technology and this was an area that we became interested in in the early 1960’s and we concluded that it was going to be very important to have computers work with instruments and there were two reasons we saw this as being important. One of them was that you liked to automate these measurements both in terms of deciding what you wanted to measure and in analyzing the data so that it gave you the data in a form that you wanted it, which isn’t always the case without the help of an instrument. So we saw this business of combining instruments and computers into an overall measurement system as a trend of the future and indeed it has become a trend of the future and it makes it possible to make instruments that can do these things automatically, that can do it more consistently and with less man-power, quite often with lower cost and also much more rapidly. There’s another interesting thing that came from this work of joining computers and instruments. It was never possible to make an instrument that’s entirely free of all errors. You can minimize the errors, but you can never get that last little error out of the picture. Our customers of course always wanted instruments to be more accurate in the thing they were trying to make so they would have some margin of safety in measurements they were making. We worked very hard to try and design our instruments to minimize the errors and to take advantage of this. It turned out that by combining computers with instruments, you could in many cases calibrate the errors out of the instrument or in a sense you could measure the error with a computer and then when you’re making the actual measurements you could correct those errors and come out with a much more accurate answer than you could without the computer.
MR. LARSON: Yes, that had tremendous application. Was that, what was the name of that computer? Was that any relation to the, what was it, the HP 80? 
MR. PACKARD: That came later. This was, the work I’m referring to now was strictly in relation to conventional digital computers.
MR. LARSON: Oh yes. 
MR. PACKARD: And we looked at the possibility of acquiring a small computer company. We finally decided to develop our own computers and we began in the middle of the 1960’s to do that. They were designed originally to work with our instruments for the reasons I’ve indicated. Again, something happened that was really just a matter of luck. We had looked a little bit at what was being done in the electronic calculator business, but in fact I visited a company in the eastern part of the country at one time and looked at what they were doing and it didn’t look as though it would have very much promise, so we didn’t do anything about it. About 1967, a young man had come in to see us. He’d been working for the SCM Company up over here. In those days, as you may recall calculators were all mechanical.
MR. LARSON: Oh yes.
MR. PACKARD: They were very sophisticated mechanical calculators, but they were no electronic calculators at that time. He said he had an idea for an electronic calculator. He’d shown it to his boss and they weren’t interested in it and wanted to know whether we’d be interested in it. Bill Hewlett and Barney Oliver, he was our chief scientist back at that time, were both very good mathematicians in their own right and they got quite intrigued with this idea that Tom Osborne came in and so we agreed to take this on and design this electronic calculator. We put a very good team of people on it and it turned out that Tom Osborne did have some good ideas and we made some basic decisions as to how we would go ahead with this development. Integrated circuits were just beginning to become known and become utilized to a limited extent. Most of the electronic work still used the discrete components, discrete transistors, capacitors and so forth. We decided that to be sure about getting the circuitry to work right we’d use discrete components. This device needed a read-only memory and we decided to make that read-only memory with a 9-layer printed circuit board and to do with a technique at the time, would require a circuit board that was about a foot square. We’d been using what were called nixie tubes as read outs. They were tubes with some wires that would glow and make the numbers so you could make numbers from one to zero to nine with these and get a numeric readout. So we designed this calculator using that technology and it turned out to be about the size of an ordinary typewriter, maybe a little bit bigger. But it had some extremely useful characteristics. It essentially had all the transcendental functions that you have, that you use on a slide rule in those days. It also had some programmability and it immediately became a very popular instrument. We sold a good many of these. I remember the timing because I left the company in the fall of 1968 to go back to Washington and I had one of these calculators with me that I kept and sometimes used in the work I was doing there. This then enabled us to get a group of people with some capability in the electronic calculator field which was similar, but still not identical to what we were doing, or intending to do in the computer business. We continued both of these things. In the interim while I was away it turned out that the large scale integrated circuit work became quite practical. Read-only memories could be put on a little chip instead of a foot square board and you could also put all the other circuitry you needed for a calculator on a chip or two. We had been doing in our own laboratories a good deal of basic work on light emitting diodes. We thought this would be a very useful technology and we had people in the laboratory that could make very good light emitting diodes, these little thousand numeric presentations. We couldn’t get people in our division to use these. They like the little nixie tubes, they were bigger and they were used to them but in any case, our work on light emitting diodes came along. Bill Hewlett got all the team on the calculator group together and said, “Now I want you to take that calculator that’s the size of a typewriter and redesign it so you can put it in your shirt pocket.” That was a genesis of the model 35 that came out in 1972.
MR. LARSON: Oh yes.
MR. PACKARD: That was really I think a very important contribution to the whole field of technology because it provided a very precise calculator that you could essentially use to replace the old slide rule. There was no need for a slide rule anymore if you had one that would give you the digital accuracy, extremely good accuracy by comparison. It became sort of the standard of everyone. Well as you know we’ve continued our work in calculators and computers, and our company now has a larger share of our total business in the field of digital data process of one sort or another, including a line of computers and peripherals and calculators. These are still used extensively in conjunction with our instruments and we are still continuing to develop newer and better electronic instruments. We introduced a new network analyzer just this year and in all kinds of engineering and work in electronics to measure the characteristics of a network, or the interconnection of transmission devices that will transmit signals in various ways. You should do this by making simple impedance measurements. In microwave work, you use standing wave indicators and that is then translated back to what it meant in terms of the energy transmittance and so forth.
MR. LARSON: Network analysis is very laborious.
MR. PACKARD: It’s very laborious and that was the way you had to do it in the early days of microwave measurement. Well we developed some techniques and I think some of the basic work came out of Stanford where you could measure the network in terms of its impedance and its transmission characteristics in a more straight forward way. The latest instruments that we brought out enable you do to do this from very low frequencies to very high frequencies. It has a lot of mini computer chips built in so you not only get an extremely wide range of measurements, but extremely high accuracy and this instrument is in a sense out of the result of many years of research and development and experience in this field. I need to say I’m very pleased that our people are still taking a leadership position in bringing out better instruments and what was our traditional field that I started back in 1939.
MR. LARSON: Actually, each one of these built on your previous experiences.
MR. PACKARD: Yes, you see you’ve got a synergism out of this. You, what you’re doing is you’re continually trying to make every instrument in your line better. Now you can’t always do this because maybe you’re at the limit of technology so your kind of at a standstill for a while, but every now and then some new idea comes along and enables you to do a little bit better job and so it’s been a very exciting business to kind of find ways in which to develop and manufacture and make available these instruments. As you know our company’s total business this coming year will probably be in excess of $6 billion. We have some 80,000 people in the company today, but in a sense we are still doing the same kinds of things that we started to do from the very beginning. So it’s been a very satisfying experience from that stand point. We’ve been able to start some work in an important field and see it keep going. I’m confident that the people working in the company are going to continue for a long time, make contributions to stay ahead of the field, even though Bill and I are no longer able to be active anymore. 
MR. LARSON: I was noticing that when you read the technical journals every once in a while a new Hewlett-Packard instrument will come out, but just yesterday, or the day before was the announcement of a new type of printer which embodied several new principals which was built on your other work in the past.
MR. PACKARD: That’s what we’re trying to do and obviously if you can do something the other fellow can’t do you have a considerable advantage. Also there is a lot of satisfaction in being able to make these contributions and our people are very enthusiastic, our development people are very enthusiastic because they know that they are able to make some important contributions and we try of course to give them good recognition and encouragement for what they are doing. The level of our activities is really quite high. We are spending in excess of $500 million a year on developing new products. That means we come out with a new product almost every day somewhere in the company. It’s a very significant effort that’s been built up over the years. 
MR. LARSON: That’s double or triple the average research and development expenditures of the average industry. 
MR. PACKARD: We’re in terms of total dollars spent in research I think the third largest in the electronics industry, after IBM and Bell Labs and then out of all industry I think we’re something like 13th largest in the country. It’s really the lifeblood of our business and what Hewlett Packard is all about.
MR. LARSON: That’s a fascinating story of the development of all these instruments which really have advanced science and technology and without which the whole business would be completely different today.
MR. PACKARD: As I said in the beginning, we were lucky to sort of been at the foundations of this whole electronics business that’s developed over these last 40 years, the real development. You know, I’m talking about this and one little story I like to tell about myself. When I was at Stanford I took a course in American History and I had an opportunity to do a sort of special studies, special studies work. I studied the westward movement of people across the country, from the early days in our history and I remember thinking when I was a junior that I had been born 100 years too late. All the opportunities, particularly in the future had gone and I was very unhappy that there wasn’t any more frontier for me to become involved in. 
MR. LARSON: That’s a fascinating story. How wrong you were at that time. 
MR. PACKARD: But you see you didn’t see these things ahead at that time. Bill and I were interested in just having a job. That was our motivation. We didn’t have any grandiose ideas of reforming the world or anything; we just wanted to be able to do something that would give us a living. Also we developed some very conservative policies for that reason and I don’t know if whether we would have succeeded in the days of venture capitalist or not. That wasn’t our way of doing things.
MR. LARSON: Well I noticed that a good deal of your capitalist self has been self-generated through the years, which is a different way of doing business than today. 
MR. PACKARD: Well it’s all been self-generated with this exception. We do sell stock to our employees. They have the opportunity to buy stock at 25 percent below the market and they bought $50 to $75 million a year of their own money into company stock. So we generate capital from that. We have no long-term debt and we’ve never sold equity. We have been able to generate enough funds to finance a growth in excess of 20 percent a year with our own resources. 
MR. LARSON: You rest on a very solid foundation financially.
MR. PACKARD: That goes back to, you see, to our sort of Depression-era philosophy which is not exactly what we’re seeing around the country today.
MR. LARSON: Things have changed. Well, in addition to all of these contributions though I of course remember your contributions when you actually agreed to go back and serve as Deputy Secretary of Defense and then also you’re activities in technical societies and your activities in the education field. I know that you were on the Board of National Merit Scholarship. My son happens to be in the first class, 1956 and this has, I know this has been a tremendous influence on education, in helping to encourage our top people. 
MR. PACKARD: I don’t know why I can’t explain exactly how I became interested in doing some of these outside things, but somewhere along the line I became interested in education and decided to run for the school board here in Palo Alto.
MR. LARSON: Oh that’s interesting.
MR. PACKARD: I didn’t know if you ever knew that.
MR. LARSON: No, I never knew that. 
MR. PACKARD: I ran for the school board in I guess it was 1946 or ’47, I can’t remember the exact date. Much to my amazement I won and served on the school board for quite a few years. Then I was invited to go on the Board of Trustees for Stanford in the early 1950’s and that was also a very interesting experience because Stanford had just embarked on a plan to develop their lands and provide a broader base to establish the industrial park here and a shopping center. At that time the board was quite small and it was a lot of fun to work with the other trustees on those problems in those days. 
MR. LARSON: That must have been a very satisfying thing to work there because education of course is the hope of the future. Unfortunately some of these policies don’t really give impetus to having our best people advance as far as they can. 
MR. PACKARD: Well, I think that education did have a rather serious setback from the late 1960’s through the early 1970’s. It came about because of a concern about social problems and equal opportunities and so forth which were perfectly legitimate concerns, but they opened up the admissions to the universities and reduced the requirements for graduation of high school and so forth. In a sense our educational system became as much an institution for social reform as it was an institution for education. I think our educational capability suffered as a result of that. I think that’s been understood and recognized now and there are a number of things being done which I think will improve the situation and the first problem is recognizing what the problem is. Then you can do something about it. 
MR. LARSON: Yes, I’m reminded of a very famous Stanford professor, Terman, I’m not sure whether he’s related, the psychologist.
MR. PACKARD: It’s his father.
MR. LARSON: His father, who did this work on the 1500 gifted children, which I followed for decades. I think he published every decade and it’s amazing how the encouragement of these gifted children led to such tremendous contributions.
MR. PACKARD: Well, it’s interesting to look at the young people. We hire about 1000 young people from various universities across the country as a result of having done this for a number of years and of the general interest in the electronics field these days. We have been able to select the best people from all these schools and I must say that the young people today are just as bright if not brighter than they ever were. I don’t think our system has suffered perhaps as much as some people might indicate. At least we’re educating them, a lot of very fine, challenging young people. 
MR. LARSON: Yes. I’m very amazed in talking with some of the young people particularly in the computer field and how they have a tremendous grasp of such complicated systems. 
MR. PACKARD: Of course our fund of knowledge is growing and the students have the benefit of more things to know today than when we were in school.
MR. LARSON: Well this is very reassuring to hear you with your faith in the future, you might say, of our bright young people that are coming along.
MR. PACKARD: Well I think actually the opportunities today are just as good as they were when Bill and I started, perhaps even better so I don’t think there is anything to worry about from that stand point.
MR. LARSON: Well, very good. Do you have any other points of philosophy that you might leave with us today? This has been a marvelous exposition of how your company got started and the contributions that it’s made.
MR. PACKARD: There is one other thing I would like to comment on. During this period that our company has been developing, we have also become involved in an international basis as you know. 
MR. LARSON: Oh yes.
MR. PACKARD: As a matter of fact, roughly half our business is outside the United States. That may vary a little bit depending on the economy in other parts of the world. I think it’s important to point out that the world economy is becoming much more interdependent than it was in the past. If economies such as ours are going to be successful we have to look at the worldwide competition, not just competition here in the United States and for that reason we have been concerned about the Japanese competition and I’ve been particularly interested in that this last year because I’ve been involved as a member of the United States-Japan Advisory Commission which we are working with  a small group of Japanese counterparts to hopefully make some recommendations on how we can maintain our good working relationship between the United States and Japan. I think we’re very fortunate that the free world is developing in a very constructive way, but in the high technology industry, the Europeans are falling behind a little bit. They’re all trying to figure out how to catch up now. We had a visit earlier this year, the Queen of England, just the other day the King of Sweden and so all the European countries are sending some of their distinguished people over here to try and see what we’re doing here in Silicon Valley as a matter of fact.
MR. LARSON: Well, that’s very interesting to see that these heads of states come right here to find out, you might say international relationships.
MR. PACKARD: Well, it is an interesting thing and of course it’s really the, Fred Terman is really the person more responsible for this development than anyone else and I’ve indicated how important he was in helping Bill and me in our business. Many of his protégés are also running other businesses in this area and that whole contribution that he began really when, in his early days and as a professor here at Stanford as I’ve indicated kind of set the ground work for that. Then when he came back after the war from his work at the Radio Research Laboratory at Harvard he continued to work on that prospect of encouraging companies to locate out here and it’s just built up over the years until now it’s a tremendous development that you see here today. 
MR. LARSON: As they say internationally, no one is the center of this type of activity. Well, Mr. Packard, I certainly want to express our appreciation for the contribution you’ve just made to this series and I’m sure, I know I’ve heard from others who I have taped, they would like to hear your tape one of these days.
MR. PACKARD: Well, I don’t know about that, but it’s been an interesting experience and I’m very glad to have you.
MR. LARSON: Well, again… 
[End of Interview]