Draft COPY
22 August 1961





Stanford Research Institute is developing a multi-disciplinary program to explore certain possibilities for making humans more effective at their professional problem-solving tasks. These possibilities stem principally from the emergence of the digital computer and its associated technology, assuming that there is a great deal of potential power to be developed in really close cooperation between man and machine. The approach being taken is quite fundamental, and yet the goal is to obtain practical results within a few years -- that is, we expect within that time to develop means for making significant improvements in the human performance of certain practical intellectual tasks.

We are establishing part of the support for this program in the form of a group-support arrangement, in which many different parties could participate in supporting our program in a manner designed to be advantageous to all. This proposal is for participation in this group-support arrangement.

There are certain unique features about this arrangement that will be described in detail in Sec. III of this proposal. Here are some of the salient features: Participation is not on the basis of a fixed-period, fixed-sum contract, but rather on the basis of an open-ended agreement (terminable with due notice) to pay a given share of one type of Program expense, per month, up to a maximum that is a contract commitment. Participants each obtain royalty-free licensing of all patents stemming from this group-supported portion of the program.



It is a common situation to find a very important activity (government, military, business, research, etc.) whose success and rate of progress depends heavily upon the ability of a few key people to grapple with complex problems. It would be of tremendous worth to our society to develop the means for making people significantly more capable in their ability to deal practically with complex problems -- to gain comprehension of the problem situation, conceive a good solution, reasonably predict the consequences of the solution, etc., repeating the process on whatever subsequent problems become associated with doing what is needed to get this solution implemented. Stanford Research Institute considers that the large potential payoff, together with the rich field of possibilities to be explored, warrants a concerted coordinated program. Over a year and a half of thought has gone into the development of a conceptual framework within which a large effort could be focused in such a program. We are now seeking means to support the build-up and continuation of this program.

This will be a unique program, representing an engineering approach to a system problem, where the "system" is the basic module with which society fills the key roles in such as our scientific and management structures. The system or module of which we speak is a human problem solver (typically, over-extended). It has to be a multi-disciplinary approach because there are many different aspects of this system to be considered in the rather sweeping system changes that are contemplated. With a number of different disciplines involved, some of which are quite esoteric, and with a goal of producing improvements in the practical capability of humans in practical roles, it seems necessary to coordinate this multi-disciplinary activity within one program structure -- and it seems highly advantageous to plan for these people, with their different backgrounds, to have close association with one another in a common environment of study and development. Furthermore, the orientation of this program seems initially dominated by the very rich possibilities of extending dramatically the real-time human utilization of tools that our technology is evolving --particularly, computers and other information-handling devices. Thus, the laboratory facilities for a concerted program will have to be quite sophisticated, and most of the workers within the program must be involved with them. Deciding that such a program is worth pursuing seriously thus leads to a picture of a fairly large, well-coordinated activity, essentially "housed under one roof."

Since the goals and by-products of this program would be of great value to industry, and since any activity toward these goals promises to be quite a bit more effective when coordinated within an energetic over-all program, it seems probable to Stanford Research Institute that a number of firms who would like to see these goals pursued actively and practically could jointly support our program in an arrangement that would be advantageous to all. Up to a certain level of expenditure (which would be considerably greater than the expected level of each firm's individual contribution to our program), the accomplishments toward goals such as ours would be much less if the supported activity were isolated from the other people and facilities needed for a balanced approach. It thus seems evident that a firm that might consider supporting a couple of researchers internally to study or work toward similar goals, would see a great deal more accomplished by their expenditure if it were applied as part of a coordinated program. We hope that our program could satisfy enough such firms to attract and keep a solid support foundation.



A. Basic Agreement

Here is the basic picture of what we are offering as a participation arrangement. Any company (Company) that wishes to participate in the program (Program) will expect to be treated in identically the same fashion as those other companies already participating (the Participants). Company agrees to contribute up to X dollars per month in support of the Program. This turns out to be C percent of the total commitment by the Participants and Company. After becoming a Participant, Company will be billed every month for C per cent of the joint-support research expenses (see Sec. II-E) of the Program, up to the limit of the X dollars committed (which reduces the relative monthly burden of the other Participants). Stanford Research Institute (the Institute) has complete control of the Program, but agrees to furnish all Participants with up-to-date information regarding activities and goals within the Program, as well as any change in the statement of Program objective. If any Participant comes to feel that participation is no longer to its advantage, it can withdraw from the arrangement three months after giving written notice. Similarly, the Institute has the right to terminate this arrangement with any or all Participants three months after giving written notice. Otherwise, the participation arrangement will be assumed as continuous by the Institute and all Participants.

For instance, Company A becomes a Participant on the basis of the method of approach which the Institute is currently taking toward the stated objectives of the Program, but the Institute will continue to pursue those objectives in the way it deems best. If the "ways the Institute deems best" change in a manner the Company dislikes, or if Company's attitude towards an existing approach changes, there will be no contractural force upon the Institute to alter its activity, but Company A is free to withdraw its support after appropriate notice.

B. Reports and Publication

Status reports summarizing activity, expenses, gross plans, etc., with very condensed analyses of general progress, will be composed after the end of each fiscal quarter and distributed to all Participants within six weeks. This will be the normal vehicle by which the Institute will announce all changes in Program plans. At natural points in the Program's development, when particular phases of activity seem to mature, or when it seems otherwise propitious, technical reports will be prepared. These will be promptly distributed to all Participants. Publication of Program results will generally be encouraged, and all developments will, as a general rule, be fully available to the public. The main restraint on this will have to do with patentable developments, and is discussed below.

C. Patents

If a development of the Program seems both patentable and, in the eyes of the Institute, of sufficient potential value, then action will be taken by the Institute to procure a patent as a valid expense of the Program. Participants who are "eligible" with respect to this patent will automatically be granted a non-exclusive, non-transferable, royalty-free license when the patent issues. Only those Participants who were paying at the time established as the conception date of the "invention" will be eligible for these automatic licensing rights. Ownership of the patents will be by a responsible organization, not a Participant, and not a manufacturer, but one whose sole function in this regard is to hold and license such patents. (The Institute may possibly take ownership and serve this function itself, but in the past the Institute has not followed the practice of holding patents, and it may be decided to continue this policy. Thus, some organization such as Research Corporation may be asked to hold patents.) Licenses will be granted on a royalty basis to any entity who wants to pay for them, and any royalties will revert to the Institute to be used in support of additional exploratory research. If any Participant or group of Participants feels that some patentable development should be so protected, but the Institute does not want to do so, then that Participant or group of Participants can prosecute that patent independently -- but all Participants again must be given royalty-free rights to any such patents, and all Participants must have the right to examine such applications and their subsequent Patent Office actions. However, ownership resides with those who executed the patent, as do any royalties subsequently associated with patents which issue from this independent action. In any case, decision as to when to publish details of a patentable development will reside with the Institute. The Institute will give serious attention to dedicating to the public any development which, although not considered worth pursuing patent-wise, might still be the source of some embarrassment to Participants at a later date if someone else happened to patent it.

D. Visits and Discussion

Each Participant will be encouraged to participate in personal contact and communication with Program personnel. A reasonable amount of Program resources will be spent for such time taken by Program personnel. If the cost of this gets out of hand (including cost to Program progress as well as to Program funds), or if there appears to the Institute to be an unbalance in the relative costs thus incurred by different Participants, then the Institute shall have the right to formalize visiting arrangements in any way that it deems fair and reasonable. For instance, it may be considered that hosting obligations can be partially met by holding scheduled Symposia to which all Participants could send a limited number of attendees. A certain amount of personal visiting and discussion time for each Participant is considered by the Institute as a basic obligation, however.


E. Special Cases of Program Support

Where advantageous to the Program, the Institute may seek or accept extra support for the Program in other than the above-mentioned arrangement. The general conditions associated with this are described below, in reference to effects upon the Participants of the above-described joint-support arrangement.


1. General Basic Support

If possible, support for most of the really basic, long-range research in the Program will be sought from special parties who would be interested in contributing specifically thereto -- it being assumed that commercial firms among the Participants would be more interested in supporting research toward the applied end. Such basic support would only be accepted on the basis that research results will be freely available to the public. Reports stemming from this work would therefore be available to the Participants (in fact, common reporting would be encouraged). Patent-wise, such a sponsor would be considered as one of the Participants, sharing rights in their patent pool and contributing patents to that pool from his work. This sponsorship differs from that of a Participant principally in that it will be for a fixed sum and will be earmarked for a relatively specific type of work. This sponsorship also may be considerably larger.


2. Government-Classified Special Work

If it seems generally to be advantageous to take on some research that is related to Program pursuits, but for which part or all of the results must be classified, then the following conditions will prevail. Any unclassified products, publications or patents, fall into the same category as for Sec. III-E-1 above. Classified publications or patents are withheld from all Participants. When these materials become unclassified they become available. Participants still get royalty-free license, subject to any government restrictions that may exist at that time, if, through proper Government channels, they learn of a need to use the patents. These above conditions refer only to Government-security classification.


F. Capital Reserves

As a financial feature of this agreement, the Institute will be free to establish two types of capital reserve, and monies required tbobuild them up will be considered as legitimate expenses to be included in the monthly billing to Participants. It is to be remembered that in any case the total monthly billing to a Participant shall never exceed his maximum monthly commitment.

The Operating Capital reserve will be three times the total monthly commitments of all Participants. To establish this reserve, each Participant will put forth a three-months' advance of his maximum monthly commitments before his participation becomes effective. This sum belongs to him and will be returned if he should at any time choose to withdraw from active participation. In such an event, the retiring Participant may assign this sum to cover his last three months' obligation to the Institute. The Institute may draw from this Capital Reserve fund at any time for any legitimate Program expense, and will set a reasonable monthly rate for the subsequent re-establishment of the fund.

If a particular special expense to the Program is anticipated in advance, it may be necessary or dr otherwise reasonably justifiable to begin advance accrual toward the expense. In such a case, a separate reserve will be established, specially designated for the particular anticipated expense, and the Institute shall determine a monthly amount to be put into such a reserve. This monthly amount shall be considered as a regular Program expense and be included in the Participants' billing.