New diamond-based quantum cryptography technology, designed to protect against Internet hacking, could become a marketable reality as soon as 2008, researchers say.

The technology, which has been in development since 2005, was last month awarded first prize in the security division of the 2007 Secrets of Australian ICT Competition. The award recognises innovation in science that will have an impact on information communication technology across the areas of commerce, health and communications.

"We are thrilled to have received the award", said Shane Huntington, director of the University of Melbourne's Quantum Communications Victoria (QCV), where the diamond-based device is being developed. "It shows that we really have a product that will help industry."

Current quantum cryptography techniques involve the use of lasers to produce approximations of single light particles, called photons, which transmit information. Due to physical properties of the photons, any unauthorised attempts at extracting transmitted information result in the information being destroyed before it can be accessed by a hacker.

QCV's device is expected to greatly improve the performance of existing commercial quantum cryptosystems by using planned defects in a diamond crystal to produce single photons of light. Diamond has been chosen as it is the only material capable of delivering single photons reliably at room-temperature over a prolonged time, researchers say.

"Our technology is a component for quantum cryptography," Huntington explained. "It replaces an approximation to a source of single photons that exists in current commercial systems."

"Our device will enable a new, 100 percent secure, telecommunication system to be developed," he said.

Diamond crystals are directly grown onto the tips of optical fibres, allowing the single photons emitted from the diamond to be transmitted down the optical fibre core. As the device only requires very small diamonds, usually less than 50 nanometres in thickness, Huntington does not expect any significant increase in cost over current quantum cryptosystems.

Huntington expects the technology to initially be used in military applications, then in any area where security is paramount. Areas in which the device is expected to have significant impact include financial institutions, security agencies, governments and individuals communicating sensitive information with total security.

A working version of the diamond-based device has already been demonstrated in the laboratory environment. The technology is currently being engineered for robustness and compatibility for integration into existing telecommunication systems.

Huntington expects a final prototype of the device to be developed by 2008, after which the technology will move to market via an anticipated start-up company. QCV last year also announced a $9 million deal with a consortium of quantum communication companies for production and commercialisation of the technology.