Industrial espionage is a growing concern. Among the threats are former cold-war spies now focusing on business secrets instead of military ones. For protection, American Telephone & Telegraph Co. has come up with a $1,195 telephone-security device it claims is simpler and cheaper than previous products. Before, assuring no one could listen in required a special stationary phone with built-in encryption. Now, an AT&T unit in Greensboro, N. C., is selling a portable device, the Model 3600, that plugs into any telephone handset.
Installation is simple: The caller disconnects the handset cord from the phone, plugs it into the security device, and then plugs the device's line back into the phone. By pressing a button, outgoing call signals are automatically turned into a stream of digital code that can only be unscrambled by a second security device attached to the receiving phone. AT&T is marketing it to businesses that worry whether rivals are tapping into their telephone-switching equipment.