The technology is called supercavitation, and it's been around for decades. The idea is to increase the speed of an object like, say, a submarine or torpedo by creating a bubble around it, reducing drag as it moves through the water. The nose of the vehicle typically is designed to create the bubble, and gas often is used to shape the bubble. The Soviets used this trick on the Shkval torpedo in the 1960s and '70s; it was capable of 230 mph but for no more than a few miles.
Obviously, the concept is proven. But there are practical problems. "The devil is in the details," says Dr. Roger Arndt, a University of Minnesota professor who works with the university's terrifically named Cavitation and Bubbly Flows Research Group.
One of the stickiest wickets is steering a submerged craft that has little in the way of control surfaces in the water. A traditional submarine is controlled by a rudder, much like a conventional boat.