From one who was there...
I worked at X during the 70's and 80's. I never worked at PARC (I didn't have the requisite PhD). I had one of the first Altos outside of California in 1975 in Dallas, Texas. From '75 to '90 when I was downsized out, I used PARC technology daily to do my job. In the late '80's I had responsibility to take some of PARC technology to the market. On Jan 1, 1986 X sponsored a multimillion $ extravaganza at Lincoln Center in NYC to announce a set of integrated products. I personally managed the installation support of many of these products at the show and at some first customers with my group from CA. These inventions were taken to market by X, BUT when it came time to roll these products into the market the money was nowhere to be found!
In the late '80's Xerox Corporation, world-wide used these products successfully in their daily business with over 40,000 workstations, ethernet -connected via Xerox Network Systems (XNS) software scattered all over the world; did anyone ever hear about that?
Here's my personal assessment:
1. The products were technologically advanced but too expensive to manufacture
2. Only customers like Boeing, the US government and a few others could afford them
3. Xerox upper management didn't understand the value proposition of these products
4. Xerox upper management preferred to count meter-clicks from copiers instead of investing in the future of the company
It makes me very sad to see the state of Xerox today.