Recent research advances have moved quantum cryptography closer to living up to its potential. Quantum cryptography, the holy grail of data security, promises a completely secure means of data communication. Governments, their militaries and bankers are eager for the benefits of hacker-proof data transmission.

In traditional data encryption schemes, the data itself is encrypted using sophisticated computer algorithms. In quantum encryption, however, a key is sent by beaming a stream of photons, representing a code, from the source to the target.

If the stream of photons gets to the other end and matches what the target expects, the data is then unencrypted. But, under a peculiar law of quantum physics called quantum indeterminacy, if anyone tries to intercept or break the code, the mere act of observing the stream of photons changes the stream, and the hack penetration fails.

"Quantum cryptography, specifically quantum key distribution (QKD), offers unconditional security based on the laws of physics only," said Hoi-Kwong Lo, an electrical and computer engineer at the University of Toronto. Lo is also the founding editor of Quantum Information and Computation, a leading journal in the field.

Lo said it has been proven that quantum cryptography can allow perfectly secure communications, something that's impossible with conventional cryptography techniques.

The current snag with quantum encryption, however, is that transmission quality tends to degrade as distance grows. Until recent work at Toshiba Corporation and Cambridge University, researchers had been limited to data rates of about 10kb per second over a distance not much greater than 20km, far short of being of much use commercially or militarily.

But now, scientists at Toshiba and Cambridge have come up with a new system that improves data transmission rates a hundred-fold. They are now achieving transmission speeds of 10mb per second. This jump has been made possible by high-speed detectors that can receive information with much higher key rates, thereby permitting the transmission of more data faster.

Lo told Homeland1 that in current experiments QKD has now been successfully used to communicate over 200km (124 miles) of telecom fiber and over 144km (89 miles) of free space. Intercontinental capabilities are not far into the future.

Commercial QKD products are already starting to appear, including the QPN 8505 Security Gateway by MagiQ, Boston, and the Cerberis by ID Quantique, Geneva, Switzerland.

The Swiss government began using QKD to encrypt and transmit election results in 2007, guaranteeing that all ballots are counted, once, in secrecy, and that no chads are left hanging.