SCOTTSDALE, Ariz. & NEW YORK -- MagiQ Technologies, Inc., (www.magiqtech.com) the quantum information processing (QIP) company, today unveiled the first commercial quantum cryptography system at DEMO 2003. The successful demonstration of Navajo, MagiQ's Quantum Key Distribution (QKD) system, is the first ever public display of a working, commercially-viable quantum cryptography system. By encoding information and placing single photons into quantum superposition, Navajo delivers secure, unbreakable and future-proof key distribution at unprecedented speeds that easily integrates into organizations' existing technology infrastructures. MagiQ today also officially announced the Navajo beta program, which currently includes ten sites within financial institutions, businesses and service providers across the United States. For additional information on the program or to become a beta site, please visit http://www.magiqtech.com/about/navajo.php. "We are honored to have been selected to publicly demonstrate Navajo for the first time ever to the attendees of DEMO 2003," said Bob Gelfond, founder and CEO of MagiQ. "We've been focused on taking the huge business benefits that have been promised by QKD in the lab, most notably unbreakable key distribution, and integrating the technology with the customer requirements that our beta sites have dictated. As the attendees of the event have seen, the result is an affordable solution that applies the principles and associated benefits of quantum cryptography with the requirements for the solution to be as plug and play as possible into organizations' existing IT infrastructures." The fundamental part of any cryptographic protocol is the encryption key - a string of random bits that are used to encode the data to be communicated between the parties. Exchanging this key with absolute certainty that it has not been "overheard" is a challenging task, and the solution to this problem lies in QKD. The security of quantum cryptography lies in its ability to exchange the encryption key with absolute security. By encoding the encryption key photon by photon and having more than one piece of information on each photon, quantum mechanics guarantees that the act of an eavesdropper intercepting a photon, even just to observe or read, irretrievably changes that photon. Therefore, the eavesdropper can neither copy nor clone a photon nor read more than one piece of information without destroying the other piece. This arises from Heisenberg's Uncertainty Principle: an eavesdropper listening in on the key distribution channel will necessarily leave traces -- and the more information the eavesdropper obtains, the greater the detectable disturbances. Consequently, the communicating parties can use part of their key to determine the presence of an eavesdropper and only use the key if appropriate. The use of continuous symmetrical quantum key regeneration and truly random numbers makes the data encryption absolutely secure. "MagiQ's Quantum Key Distribution system is at the forefront of new security technologies and provides unbreakable security, based on the laws of physics rather than mathematical algorithms," said Chris Shipley, executive producer of DEMO 2003. "The ability to constantly exchange encryption keys with absolute security is a huge benefit for security-conscious organizations in government and businesses with high-value intellectual property. I am delighted to have MagiQ unveil its next-generation security system at DEMO, as it's sure to play an active role in protecting our corporate and national IT infrastructures." Today's encryption solutions rely solely on computational difficulty for their security. The assumption is that it would take thousands of years of computer time to decrypt these messages using brute-force or various decryption algorithms. However, as computing power continues its dramatic rise, and new algorithms are developed, today's secrets could become vulnerable in the future - presenting major threats to countries' national security, corporations' intellectual property and confidential information in general. QKD is designed to provide security assurance for the long term, since it relies not on ever-changing computational difficulty, but on the fixed principles of physics. The Navajo QKD system cannot be cracked using mathematical algorithms or brute-force attacks. MagiQ Technologies Inc.