PROBLEM: High-tech piracy isn't limited to illegal downloads and knockoff DVDs: there are growing, multibillion-dollar gray and black markets for the microchips that run everything from video players to high-end weapons. Unscrupulous employees in overseas foundries that produce chips for other companies can divert extra chips, made for pennies, and resell them.
SOLUTION: Farinaz Koushanfar, an assistant professor of electrical and computer engineering, has developed a way to foil hardware pirates using tiny physical variations between circuit elements on a chip--variations produced normally in the chip-manufacturing process. As small as a stray atom or two, the variations cause identical signals traveling to two such elements to arrive a few trillionths of a second apart; each chip contains hundreds of these pairs. For each pair, Koushanfar designates the first signal to arrive as a 0 and the second as a 1, creating an ID code unique to each chip. When a buyer first uses the chip, it transmits its ID to its designer over the Internet. The designer sends back a corresponding "unlock" code that makes the chip usable. Koushanfar has created prototypes of the coded chips, and several chip makers have expressed interest in the technology. --Neil Savage