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The QKD system developed by id Quantique SA is based on the well known Plug&Play auto-compensating design , schematically represented on Figure_1.
A strong laser pulse (l = 1550nm) emitted by Bob's laser diode (LD) is separated at a first 50/50 beamsplitter (C1). The two pulses then travel to the two input ports of a polarization beamsplitter (PBS), after having travelled respectively through a short arm and a long arm which includes a phase modulator (PMB) and a 100 ns delay line. All fibres and optical elements at Bob's are polarization maintaining. The linear polarization is turned by 90° in the long arm, so that the two pulses exit the polarizing beamsplitter by the same port.
The pulses travel down to Alice, are reflected on a Faraday mirror (FM), attenuated and come back orthogonally polarized. In turn, both pulses now take the other path at Bob's and arrive at the same time at the C1 beamsplitter where they interfere. They are then detected by one of the two single-photon detectors (InGaAs/InP APD's inGeiger mode). Since the two pulses follow the same path inside Bob's set-up but in reverse order (short – long or long – short paths), this interferometer is auto-compensated.
The BB84 and SARG  protocols are implemented using phase coding. Alice applies one of four phase shifts (0, p/2, p, 3p/2) on the second pulse of each pair. Bob performs basis selection by applying one out of two phase shifts (0, p/2).
In order to avoid noise enhancement by Rayleigh backscattering, the laser pulses are emitted in trains and are stored in a long delay line (DL, 24 km) by Alice before being sent back to Bob. Alice also has a classical detector DA, which allows her to time her the application of her phase and to detect the attempt by an eavesdropper to perform a Trojan horse attack.
Figure 1: Self-aligned plug-and-play system: LD, laser diode; APD, avalanche photodiode; Ci , fiber coupler; PMj , phase modulator; PBS, polarizing beamsplitter; DL, optical delay line; FM, Faraday mirror; DA , classical detector.
The Plug&Play auto-compensating design offers the advantage of being highly stable and passively aligned. It has moreover been extensively tested by several groups world-wide.
This system is an improved version of the commercially available Vectis quantum key distribution system (see www.idquantique.com/products/vectis.htm for more information), which was used in October 2007 to secure the Swiss federal elections in Geneva.