On this day in technology and business history...

On Dec. 9, 1968, a group of about 1,000 computer scientists attended a demonstration so advanced that its true importance wouldn't be understood for many years. The vast majority of attendees thought the demonstrator was a crackpot. They questioned the usefulness of his developments. They didn't know what they were looking at. But what they saw was the future at this "Mother of all Tech Demos," one of the most important events in computing history.

Source: SRI International, via Wikimedia.

Presented by Douglas Engelbart of SRI International (then known as the Stanford Research Institute), the demonstration blew away the punch cards and paper printouts then in use by multiton mainframe computers of the era. Engelbart's demonstration contained the first use of a pseudo-graphical user interface, the operating system of which was dubbed NLS, for "oN Line System." It was also the first demonstration of a computer mouse, which Engelbart and his team had invented and then named for the "tail" of its connecting cable. It also introduced the world to hypertext, the linking of one reference point to another, which featured in the first word processor, another Stanford development. It also included the earliest computer videoconference, and had a proto-network that allowed collaborative real-time edits, with multiple people working on the same document simultaneously. It even contained the earliest conceptual form of PowerPoint!

The demo was so streamlined that a Wired retrospective on the event's 40th anniversary claimed that "even a modern-day computer user might feel envious at the speed and ease with which he moved words, sentences and outline headings on the page." Professor Andries van Dam remembered the demo as a seamless operating environment that modern computers still haven't matched. On the 40th anniversary of the Mother of all Tech Demos, he told The Register that "NLS hasn't really been realized with the mainstream market." Four decades later, we still didn't have a system in which all the component programs work together seamlessly. "Everything inter-operated in this super rich environment," said Van Dam, "and if you look at the demo carefully, it's about modifying, it's about studying, it's about being really analytical and reflecting about what's happening."

NLS was the inspiration for Xerox's (XRX) PARC team to develop the Alto computer, which is often considered the grandfather of personal computing. PARC built a true graphical user interface on top of NLS' mouse-based navigation, which later inspired both Steve Jobs at Apple (AAPL 0.64%) and Bill Gates at Microsoft. These two companies earned far more from Engelbart's innovations than Engelbart ever did, despite the fact that he is listed as the inventor on the 1970 patent for the computer mouse. SRI International later licensed the mouse patent to Apple for its groundbreaking personal computers for the rather paltry sum of $40,000.

Engelbart retired in 1986, but remained active in the computing world until his death on July 2, 2013, at the age of 88. During his "retirement," Engelbart received numerous high honors for his work in computing, including the National Medal of Technology, which President Bill Clinton presented him in 2000. Engelbart continued to use a modified version of NLS on his home computer for decades after his groundbreaking demo planted the seeds of the modern multitrillion-dollar PC industry.

You can watch the Mother of All Tech Demos in its entirety on the Stanford website.