Quantum mechanics, Carl Sagan once observed, is so strange that "common sense is almost useless in approaching it." Scientists still don't understand exactly why matter behaves as it does at the quantum level. Yet they're getting better at exploiting its peculiar dynamics -- in ways that may soon upend the technology business.

One of the most interesting applications is in computing. In theory, quantum computers could take advantage of odd subatomic interactions to solve certain problems far faster than a conventional machine could. Although a full-scale quantum computer is still years off, scientists have lately made a lot of progress on the materials, designs and methods needed to make one.

And that could have some striking benefits. Quantum computers could simulate how atoms and molecules behave, to the great advantage of chemists and drug designers. They could solve optimization problems -- say, how to efficiently route airplane traffic -- far faster than current technology can. They could speed advances in artificial intelligence, improve sensors, and lead to the design of stronger and lighter industrial materials.

Unsurprisingly, then, investment in the field is surging. IBM,Microsoft and Google are all building quantum research labs. Startups are gearing up. Banks are very interested indeed. Governments see applications for space exploration, medical research and intelligence-gathering. America's National Security Agency, in fact, has been quietly trying to build a quantum computer for years, in the hope that it would make an unstoppable code-breaker.

And that suggests a looming problem. To simplify a bit, the cryptographic tools commonly used to protect information online rely on very hard math problems, such as factoring large integers, that normal computers can't solve in a reasonable time frame. Quantum computers, though, could probably make quick work of such equations.

As a result, they could undermine the security of everything from mobile phones to e-commerce to cloud computing. Within two decades, by some estimates, quantum computers may be able to break all public-key encryption now in use. "The impact on the world economy," says the nonprofit Cloud Security Alliance, "could be devastating."

David Fuller's view

For computer security specialists, this is the equivalent of: ‘… and just when you thought it was safe to go back into the water.’

For instance, quantum computers should have no problem in outsmarting the latest, albeit not fully developed, blockchain security system.  And how will quantum computers hold up against self-programming artificial intelligence?

We live in increasingly interesting times. 

Three powerhouse technology firms are mentioned above for their work on quantum computers – IBM, Microsoft and Google.  Technology companies are in an extraordinary exciting and profitable field, only they have to keep reinventing themselves to stay in front.  This is virtually impossible but if they have deep pockets and good management, they can always attract sufficient talent to re-establish themselves. 

After a difficult three-year hiatus, IBM is on its way back judging from this year’s recovery.  IBM was all but written off last year but it looks like patient Warren Buffett may be right after all, and obviously not for the first time.  Similarly, Microsoft underperformed for many years before commencing a new uptrend in 2013.  Google (now Alphabet) looks very similar.  All three shares are temporarily overbought and due for reactions and consolidations.  However, I would continue to give the upside the benefit of the doubt provided: 1) climactic upward accelerations relative to what we have seen to date within current upward trends do not occur; 2) setbacks do not break support within the previous step sequence uptrends.