WASHINGTON -- Hoping to cash in on an increasing US government interest in quantum computing, D-Wave Systems is launching a Washington-focused subsidiary.

D-Wave, based in British Columbia, is the only company in the world currently offering a functioning quantum computer. They have sold systems, which run in the range of $10 million per computer, to three customers: Lockheed Martin, Google and the Los Alamos national laboratory. However, there are government customers, such as the Navy, who are renting time on D-Wave owned computers.

Bo Ewald, president of D-Wave International, told Defense News that the decision to open a government-focused subsidiary was in many ways a practical one.

"The US government is the largest procurer of computers on the planet. They also are the ones who typically apply technologies before others do for programmatic needs, whether it be the Pentagon programs or Department of Energy or the intelligence community," Ewald said.

"I don't have an exact dollar figure [for potential business], but I can imagine that as this business really gets rolling that there will be several of these big systems within the DoD, the DoE labs, the intelligence community networks," he added. "Whether they lease them, purchase them or are using a cloud service, it's too early to tell yet."

The new subsidiary will be known as D-Wave Government Inc. and will be led by René Copeland, currently director of government sales for the company. The board will be chaired by Jeffrey K. Harris, a former Lockheed executive who also served as director of the National Reconnaissance Office and assistant secretary of the Air Force.

Other board members include Delores Etter, former deputy under secretary of defense for science and technology and assistant secretary of the Navy; Frances Fleisch, former executive director of the National Security Agency and special adviser to U.S Strategic Command; and Donald Kerr, a former director at Los Alamos who also served in top roles with NRO and the CIA.

Whereas traditional computers base everything on either a 0 or a 1, quantum computers are able to perform much more complex operations. Because of that, they can process data sets at a significantly higher rate than traditional computing systems.

Quantum technologies offer major potential across the tech industry, but could be particularly game changing for the Pentagon when it comes to concepts such as protected communications. However, a 2015 study by the Air Force Scientific Advisory Board, an independent federal advisory committee made up of 50 scientists and researchers, concluded that in many cases quantum technologies are too complicated for the payoff.

At the time the study concluded, Werner Dahm, a former chief scientist of the Air Force who serves as the board's chairman, told reporters that "these systems have enormous potential, but there is much more hype than reality in there."

The one quantum area Dahm saw as realistic in the near-term was quantum computing, with the potential to crunch the massive amounts of data that the Air Force gathers every hour and has routinely struggled to manage. But he warned that the real challenge is not the hardware but writing the algorithms that would be necessary to make it work.

Ewald agrees that algorithms are going to be the deciding factor for how this technology is used by the Pentagon – and he thinks that the potential military customers should take the lead in that area.

"We hope we are able to get some of our hardware into the hands of really smart people in the DoD and let them work on algorithms and applications of interest that only they know about," Ewald said. "We know how to build this particular type of quantum computer but we don’t know how to do the applications. We’ll work on software tools with them but the most important part in the end will be applications."

And what are those applications? Ewald sees massive potential for that data problem, but also for optimization of logistics efforts, given the massive amounts of US military material moving around the globe at any given time. It could also help with big-picture design issues such as scheduling the most efficient constellation for a network of satellites to capture imagery around the world. Another is machine learning, which can be used to train autonomous systems.

Ewald said D-Wave’s systems are largely being used for research and experimentation with its current Pentagon customers. That includes "serious" work going on with various DoD research labs and the Navy’s Space and Naval Systems Warfare Command.

However, that work is all on rented time on a machine, and Ewald acknowledged it may be a few years before the Pentagon is comfortable enough to shell out the money for its own quantum computer.

That said, when the Pentagon is ready to buy such a system, Ewald is confident he will be able to deliver, despite the Department of Defense’s notoriously difficult acquisition system. After all, the lack of competition means the Pentagon could sell such a contract as a sole-source agreement.

"It would be silly today to have an open procurement and call all the vendors of quantum computers for proposals, because there’s only our system today. So in that sense there are rules about when there is a single vendor," he said.