This is all new. It's an all-new market," said Barry Margerum, vice president of defense systems marketing for Grid Systems.

The Silicon Valley start-up, founded in 1980, was the first company to build an NSA-approved portable Tempest computer, and it is just now being shipped. Grid's Tempest computer, which sells for a hefty $12,500 -- or $4,500 more than the unTempested version -- is seen by government officials and industry analysts as a potential winner in the procurement sweepstakes for Tempest machines. "It's a sleek-looking device and a darn good machine," said one national security official who asked not to be named.

Stationary computers can easily be placed in a Tempest-proof box. Portable computers pose a special challenge to Tempest because, if the machines are sheathed in heavy metal, they are no longer that portable. But according to Tempest specialists, the smaller computers generate a clearer signal for Tempest eavesdroppers to tune into.

Consequently, Grid has taken a number of precautions to assure its mission meets the NSA specifications -- including copper lining and special filters. Although Grid declines to comment, one engineer speculated that software within the machine is designed to transmit static to Tempest receivers.

Margerum declined to project any sales for the new machine, but pointed out that people want the ability to compute anywhere. He also noted a little-known NSA communications security directive he said is sure to boost all Tempest sales because it allows the government to subsidize the cost to private companies of acquiring Tempest equipment.

The Tempest market represents a major shift for Grid, which once aspired to be the next Apple Computer Co. Grid's high-priced Compass computer originally was described by industry journals as the "Porsche of PCs," but sales of the machine never took off.

Said one Silicon Valley venture capitalist who has followed Grid, "They're lucky they tapped into the government market, or they'd be in real trouble."