"We've demonstrated encrypted video because we wanted to show two things, first of all that we encrypt a large amount of information, and secondly that we can regularly change the encryption key," said Shields. "We've also carried out some tests with MCI and seen that our system can operate on their network continuously for a month with no problems."

Communication with quantum cryptography is inherently secure because each bit in a cryptographic key -- basically a large number that should only be known to the sender and receiver -- is encoded upon a single photon. Any attempts by a third party to "hack" or copy this key will quickly become obvious to the sender and receiver.

Toshiba's "Quantum Key Server" can generate up to 100 quantum (single-photon) keys per second, enough to encrypt each video frame with a separate key. It operates at 1.55 microns over standard optical fibre and continually monitors and adjusts the optical path length to allow the system to operate continuously without any need for user intervention.

At present Toshiba uses heavily attenuated laser pulses to generate the quantum key and customized avalanche photodetectors to detect them. However, Shields says that the firm is developing quantum-dot based LEDs and detectors that can generate and detect single photons. "This technology [quantum dots] is not only potentially low cost but could also allow higher bit rates and longer fibre lengths," he said. "We have prototypes devices for both and are now integrating them into our cryptography system, but it will be 2 to 3 years before it is used routinely."

Last year quantum cryptography was used in a commercial transaction for the first time when the Mayor of Vienna transferred money from the City Hall to Bank Austria Creditanstalt over a fibre-optic cable using a quantum key.