Text | AI Finance and Economics Editor Niu Geng | Zhao Yanqiu Quantum Communication is becoming another hot industry beyond chips. According to industrial and commercial information, there are more than 4,200 companies in China with business scope including "quantum", of which 85

text | AI Finance and Economics Niu Geng

edit | Zhao Yanqiu

Quantum communication is becoming another hot industry outside of chips.

According to industrial and commercial information, there are more than 4,200 companies in China with business scope including "quantum", of which 85% were registered within 5 years, which is no less than the "chip company registration boom" in the past two years. Guodun Quantum and Jiuzhou Quantum, which had been in court, had the stock price of the former rose for one week in early December, while the latter rose for more than 10 days. Even the top leadership collectively learned quantum technology not long ago.

Behind the capital market gold-mining craze, there is a competition that may be related to national security.

On December 10, the Jiuzhang quantum computer prototype was released. The speed of solving the mathematical algorithm Gaussian Bose sampling is 100 trillion times faster than the current fastest Google supercomputer. Before that, the world's top technology companies, from IBM, Google, and Alibaba, had spent several years studying quantum computers. The general consensus in the industry is that when quantum computing is successfully applied, all existing encryption algorithms will be vulnerable. The only thing that can resist is the technology that uses the same microscopic characteristics of particles to encrypt information, namely quantum communication.

The leader in quantum communications of China and an academician of the Chinese Academy of Sciences Pan Jianwei once compared quantum computing and quantum communication to "spear and shield". Previously, China's "spray" was not sharp, but the "shield" was already ahead of the world. And now, the war is escalating. The United States has changed its initially conservative approach to quantum communication, that is, "shield". The Sino-US quantum battle has begun.

started on the summer night 40 years ago

In June 1983, Guo Guangcan , as a visiting scholar, attended the "Coherent and Quantum Optics Conference" held at the University of Rochester, New York, USA. This is the fourth session, and quantum technology is becoming a prominent science, but it is still relatively unfamiliar to Chinese scholars.

During this academic conference, several Chinese scholars gathered at one of them, eating watermelons and communicating all night. "Everyone was very excited and felt that this was a brand new field." Later, some people recalled that at that time, someone expressed their intention to return to China to carry out research in this direction.

1984, after returning to China, Guo Guangcan obtained more than 2,000 yuan from the University of Science and Technology of China and held the first national quantum optics academic conference in Chuzhou, Anhui Province. This became the beginning of China's quantum optics. Many years later, Guo Guangcan will become a master in this field and bring another general, Pan Jianwei, back to the country.

At that time, Pan Jianwei was still in high school in Zhejiang. In 1987, Pan Jianwei was admitted to the Department of Modern Physics of the University of Science and Technology of China, and used quantum physics as the direction of his undergraduate thesis. After graduation, when all the classmates went to the United States to study, Pan Jianwei was thinking about the quantum physics authority of Austrian , Anton Salinger.

At that time, Salinger had just discovered an important theorem about entanglement of multiple particles and began to build his own quantum laboratory in Austria. He urgently needs an assistant to verify his experimental conjecture. At this moment, he met Pan Jianwei.

Salinger asked Pan Jianwei, what is your dream? Pan Jianwei, who was amazed at the laboratory in front of him, directly replied, "Build a world-leading laboratory like you in China." Many years later, the long-cherished wish comes true. Salinger sighed, "I always believed that he would have a bright future, but I didn't expect it to be so successful."

In 1999, Pan Jianwei, who was in his early 30s, received his Ph.D. in experimental physics in Austria, and then returned to the University of Science and Technology of China to start the establishment of the Quantum Physics and Quantum Information Laboratory. Two years later, Guo Guangcan established the Key Laboratory of Quantum Information of the Chinese Academy of Sciences . Both laboratories focus on the research of quantum communication.

"Luckily, in 2000, China's economy began to take off, so the time for high-quality scientific research suddenly came." Nature magazine quoted Pan Jianwei's words at the time.Research on quantum communications in

may bring about a completely new and completely secure way of information transmission. Simply put, if "information encryption" and "key" are compared to "safe" and "key", then in quantum communication, "interlocking photon " is used as the key, and the photon is the smallest light particle. The keys transmitted in this way can be discovered by the sender and receiver even if they are intercepted, just like finding that the seal attached to the safe has been damaged. Pan and other scholars aim to transfer the keys as far as possible to distance.

In the view of industry insiders, Pan Jianwei and Guo Guangcan's laboratories also use QKD (quantum key distribution) and also use the BB84 protocol. But Pan's encoding method is based on the polarization of light, while Guo is based on the phase. This later became Pan and Guo Guo's company, and the technical routes of Guodun Quantum and Wentian Quantum were different.

When he first returned to China, Pan's work was not as dazzling as his master Salinger. But Pan quickly found a way to "overtake on the curve". To do quantum communication, many talents are needed, such as optics, cold atomic physics, electronics, vacuum, etc. According to his students' strengths, Pan assigned them to a large number of sub-research centers around the world for further study. "Then they are all willing to come back," said a student in Pan's group. This move proved that Pan Jianwei was very visionary, which made his laboratory produce huge explosive power later.

In the next seven years, with the efforts of Pan Jianwei's team, the transmission distance of the "key" continued to be extended: first, fiber optic transmission experiments were conducted locally in Hefei, then in Beijing Great Wall and Qinghai, and finally exceeded 97 kilometers in 2012, breaking the world record. After that, Pan began to study the distribution of entangled photons through satellites.

There is another big thing that really changes the pattern. In 2009, Pan Jianwei's team built quantum communication network in Hefei covering the urban area, including 46 nodes, which marks the maturity of the metropolitan quantum communication network. The Anhui Provincial Government and the Chinese Academy of Sciences then made a decision, and Pan Jianwei and Guo Guangcan participated in the establishment of two companies, namely Guodun Quantum and Wentian Quantum, hoping to promote quantum communication to industrialization. Zhou Lei, project director of Guodun Quantum, also joined the company at that time. He recalled that at first there were only a dozen or twenty people in the company. After a conversation with the teacher in the research group, he had just graduated from a doctorate and chose to join the company and embarked on more than ten years of industrialization.

But even he may not have expected that the backbone of the company will not only be worth hundreds of millions of yuan, but will also become the trendsetters in competition between countries.

China's investment has made American peers jealous

"China has a well-thought-out strategy for developing this technology." Duncan Earl, president and CEO of Qubitekkk, American quantum communications company, commented in the media. Compared with the hundreds of millions of real money invested by China, the US government and industry have long believed that "quantum encryption is nothing more than a scientific experiment", so researchers' energy has been focusing on using mathematics to build new methods that can resist quantum computers without planning to build new infrastructure.

In China, in 2013, the " Beijing-Shanghai Trunk Line " quantum communication network was launched, with a total length of more than 2,000 kilometers, connecting Beijing and Shanghai, running through Jinan and Hefei, and is also the world's first quantum confidential communication trunk line. This trunk line costs 560 million yuan and is undertaken by the National Development and Reform Commission and local governments.

"The country has made great determination to build the Beijing-Shanghai trunk line." Guodun Quantum employees recalled that this also became a turning point in the development of the company in this field.

In 2015, the Chinese Academy of Sciences simply included quantum communication in the strategic area of ​​the "Take the First Action" plan, and launched the strategic pilot science and technology special project " Quantum Science Experimental Satellite " project in the "13th Five-Year Plan" to complete the application and construction of the "Beijing-Shanghai Trunk Line".

In 2016, a quantum science experimental satellite called " Mozi " weighing more than 600 kilograms was launched on the Gobi Desert. In order to commemorate the Chinese philosopher and scientist Mozi in the 5th century BC, this satellite successfully realized a video call using quantum encryption technology between Beijing and Vienna, expanding the distance to a record 7,451 kilometers. In the same year, after four years of planning and construction, a dedicated quantum communication network between Beijing and Shanghai was also completed and put into use.

In 2017, the Beijing-Shanghai trunk line and Mozi realized "interconnection of heaven and earth", marking that China entered the stage of quantum communication wide area network. This is a feat that no country in the world can achieve. This achievement has made scientists around the world jealous.

After the national resources were in place, Chinese scientists also seized the opportunity, and the speed of iterative technology attracted the attention of the whole world. When the Mozi was launched in 2016, the satellite weighed 640 kilograms, which only verified that the satellite could transmit quantum entangled photons, but did not reach the practical stage, and the speed of key generation was not optimistic. But in June 2020, in the international academic journal Nature, the latest research released by Chinese scientists showed that they have increased the speed of key generation, reduced the error rate, and built a "safety channel that can resist attacks."

"This is an important milestone." Duncan Earl, who closely monitors China's progress, said, "It is the scale of technology that makes this so important. They are an incredible group." Pan Jianwei believes that based on these studies, the weight of satellite equipment can be reduced to dozens of kilograms and the weight of ground equipment from more than 10 tons to about 100 kilograms, thus truly opening the door for commercial applications.

Of course, these studies have also won honors for Pan Jianwei: at the age of 27, the research results ranked among the "Top Ten Global Science and Technology Progress of the Year" of Science and the "21 Classic Papers in Centennial Physics" of Nature. At the age of 31, they became professor at the University of Science and Technology of China, and at the age of 41, they became the youngest academician of the Chinese Academy of Sciences. In 2017, they ranked among the top ten scientific figures of the year of Nature.

Chinese scholars also live alone in their eyes when they get a "food ticket" for quantum communication. Guo Guangcan initially looked for applications for quantum communication, not the military or government departments, but units such as Bank of China that have commercial business needs. After discussing with the Bank and the China Banking Regulatory Commission, Pan Jianwei's team was very excited because "the more than 2,000 kilometers of fiber optics from Beijing to Shanghai originally wanted to protect all points, but now it is enough to only protect a few relays."

In November 2020, the "quantum encryption mobile phone" jointly planned by Guodun Quantum and China Telecom also flooded the media. Some people from Guodun Quantum said that this is using algorithms and keys in the SIM card to encrypt user's voice information. Although "whether it is large-scale promotion depends on China Telecom", this device has attracted a lot of attention from the general consumer group.

Of course, in the process of industrialization of quantum communication, several dark clouds floated from time to time.

There was an article questioning the problem that the Beijing-Shanghai trunk line was "on work with illness", and that quantum communication has low coding rate and easy communication to be blocked. To this day, the application value of quantum communication is still widely discussed among the public.

But it has to be mentioned that quantum science is a natural "living target" and is "sighted" by civil science and the public. When Academician Guo Guangcan applied for the project, he was questioned as "pseudoscience". Some security experts are also skeptical of the effectiveness of quantum encryption. Because this technology is too new, it has not yet been subjected to any rigorous testing recognized by cryptographers.

In 2017, Peng Chengzhi, a general under Pan Jianwei, published an article saying that Zheng Shaohui, chairman of Jiuzhou Quantum, threatened to "kill his wife and daughter", and the two sides finally went to court, pushing quantum communication to the forefront.

Zheng Shaohui was born in Zhejiang's state-owned assets background. Later, through Shenzhou Quantitative, he participated in the construction of the "Shanghai-Hangzhou Trunk Line" with Guodun Quantum. In addition, Yunhong Investment, controlled by Zheng Shaohui, directly invested in Guodun Quantum.However, the investment price of 50 yuan per share was eventually changed to 36 yuan per share, and the 32.34 million yuan saved was "lent" to nine senior executives, including Peng Chengzhi, chairman of Guodun Quantum.

Zheng Shaohui paid for the money and Pan Jianwei made the money, which should have become a beautiful story. However, after Zheng Shaohui's Jiuzhou Quantum landed on the New Third Board in June 2016 and harvested a wave of "quantum technology" leeks with a market value of 30 billion yuan, Peng Chengzhi's team separated from Jiuzhou Quantum.

According to Zheng Shaohui and Yunhong Investment, after , Pan Jianwei and other shareholders cashed out hundreds of millions of yuan from Guodun Quantum, which made financial practitioners worried that "the investment funds of the technical team were borrowed from the fund (Yunhong Investment), but they cashed out first and could not explain to the fund." Zheng Shaohui saw Pan's team cash out and hoped that the other party would repay the loan of 32.34 million yuan first. After being rejected, there was a scene of "threatening hammer killing".

This Rashomon, "Let's fill this pit today." Some middle-level employees of Guodun Quantum said they were worried that quantum communication would be considered to be a fraud to cut leeks and eventually destroy this immature industry. "If it happens again today, we will have a more mature way of dealing with it."

In March 2019, , which focuses on hardcore technology and basic technology, opened the gate, adding fire to quantum communications that require long-term investment. In July 2020, Guodun Quantum landed on the Science and Technology Innovation Board, with an increase of more than 1,000% on the first day, and the stock price is as high as the first day of listing of the Science and Technology Innovation Board. "We were also very sad before," said a Guodun Quantum employee. The optimistic capital market has allowed this company to be free from worrying about food and clothing and to be safe in industrialization.

Due to China's progress in quantum communication, it also gains advantages in standard setting. At present, domestic companies have cooperated with ITP (ITU) and ISO (International Organization for Standardization), and even the chairman of the ITO Quantum Technology Focus Group is Chinese, namely Professor Zhang Qiang of the University of Science and Technology of China.

China-US quantum battle

Behind the glamorous achievements, China's quantum communication industry still has "embarrassment". If China relaxes a little, other countries will seize every opportunity to catch up.

In China, Guodun Quantum and Wentian Quantum are already the two most technically capable equipment companies. As of the end of 2018, more than 6,000 kilometers of quantum communication networks built by China used Guodun quantum products, and more than 700 kilometers of Wentian quantum products were used. But what is embarrassing is that Guodun Quantum, which has just been listed, is still losing money.

According to the third quarter report in October 2020, Guodun Quantum lost 22.68 million yuan in the first three quarters, a slight narrowing year-on-year. Cooperation with it, Guokeliang.com, which was also established by the technical teams of Guoke Holdings , University of Science and Technology and Pan Jianwei, was once insolvent in 2019.

"The domestic R&D power is mainly in these two companies." Some industry insiders said. Another company that has attracted attention is Quantum. actually gradually developed from Guodun Quantum. mainly does market-oriented work. And Jiuzhou Quantum is now gradually silent.

and even the battle of talents revealed the "lostness" in the field of quantum communication. Peng Chengzhi once replied to the students who wanted to work in the competitors, "It's really not easy to find a job, so you can go there."

According to relevant reports, after the completion of the Beijing-Shanghai trunk line, the National Development and Reform Commission built the first phase of the National WAN network, connecting Beijing-Wuhan-Guangzhou, about 3,000 kilometers. But even so, industry insiders said that compared with mobile communication technology, quantum communication is less than 1G, and is still a very small market and is in the early stage of investment. In the future, only after the equipment is miniaturized and chipped and integrated with the existing communication network can we truly open up a broad world.

While Chinese companies are struggling to survive, other countries are catching up. Although a lot of the United States' research and application of quantum communications are in the military and hidden behind the scenes, it is also coming in full force after seeing China's practices and recent progress in quantum communications.After all, this is a race that could affect national security.

In July 2020, the US Department of Energy released a report proposing a blueprint strategy for developing the country's quantum Internet . The report said that the quantum Internet, which is in its early stages of development, will have a profound impact on critical areas such as science, industry and national security.

In this plan, the U.S. Department of Energy even mobilized 17 U.S. national laboratories to act as backbone forces. "By building this emerging technology, the United States will continue to work to maintain and expand our quantum capabilities," said U.S. Secretary of Energy Dan Brouillette. "In February this year, the

, the Chicago 52-mile "quantum ring" funded by the U.S. Department of Energy, made the United States one of the countries to build the longest land-based quantum network. Foreign media said it may "dwarf the network used by China."

On July 23, 2020, the U.S. Department of Energy also announced the choice of the Chicago Quantum Exchange as the first U.S. Department of Energy's Quantum Center dedicated to the development of the quantum Internet. It is a $125 million, five-year quantum center program.

In addition to the national project, according to media reports, American quantum communication companies Quantum Xchange and Qubitekk are also rapidly commercializing quantum communication technology. Qubitekk uses quantum encryption to protect Tennessee's power grid, and Quantum Xchange builds a quantum encryption network in the northeastern United States, hoping to serve Wall Street banks and other businesses. At the same time, European ID Quantique, Japan's Toshiba, NEC, South Korea's SK, etc. are also trying to build quantum communication networks.

"The achievements of the United States are behind the scenes, while Japan and South Korea are using their chip advantages to cooperate with Europe." Some industry insiders said that although China's quantum communication research, represented by Pan Jianwei's team, occupies a lot of international voice, China cannot take it lightly in this war of escalation of war.

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