The problem lay in a protocol known as Wireless Equivalent Privacy (WEP). It was widely reported that the WEP protocol - the standard that outlines how data will be encrypted on the 802.11 wireless network - was implemented in a way that made it vulnerable to attack.
A hacker could intercept communications sent over the network simply by having a piece of software running on a laptop within range of the network together with a wireless network scanner. This is obviously a serious risks for businesses that deployed wireless LANs because any confidential data - financial transactions, credit card numbers and a company's proprietary information - that is flowing over these networks can be compromised or exposed.
The affected wireless networks currently encrypt data using an RSA Security algorithm, known as RC4. The attacks against WEP were not a result of a weakness of the RC4 algorithm, but instead a weakness in how WEP derived RC4 keys for different data packets from a secret shared between wireless clients and access points. Simply put, the keys for different packets were too similar. Hackers could exploit this similarity to extract information about the shared secret after analysing a modest number of packets. Once the shared secret was discovered, a malicious hacker could decrypt data packets being passed along the exposed network.
RSA Security and Hifn, another security company, have developed what they call the “Fast Packet Keying” solution which is designed to avoid the similarities in the packet keys by providing a rapid way to derive unrelated RC4 keys from a shared secret. Fast Packet Keying will create a unique key for each data packet sent over the wireless network.