Liberty Alliance threatens MS and its Passport

Randy Heffner

AOL and American Express both announced that they will join the Liberty

Alliance headed by Sun Microsystems, placing additional pressure on Microsoft

and its Passport offering. Besides these two major commitments, Liberty claims

that it has received a flood of over 3,000 companies inquiring about membership.

This strength of support for Liberty, even while it does not yet have a

concrete technology proposal, shows the degree of realization across the

industry of the need for an independent Internet single sign-on (I-SSO)

standard. User pressure will drive interoperability of Liberty and Passport, but

it is still unclear at what level that interoperability will be achieved:

authentication, authorization or at the higher "wallet" level. Giga

recommends clients remain tactical in their approach to I-SSO in general and

Microsoft Passport in particular.

The battle for the upper hand in defining I-SSO standards is a battle for

user accounts. The higher the number of credible user accounts a standard can

claim, the more pressure it can place on others to adopt the standard. Both

Microsoft and Liberty have been touting user numbers.

AOL’s commitment to Liberty is significant for two reasons. First, AOL’s

Magic Carpet was a potential competitor to Liberty and now that AOL will support

whatever standards Liberty promulgates, Magic Carpet is at least cooperative

with Liberty (although it will not be restricted to supporting only Liberty’s

standards). Second, AOL brings a high quality base of users into the Liberty

camp.

While Microsoft claims 200 million Passport users, a large percentage of

these are what Giga considers "low quality." The numbers include

one-time users of Hotmail or Microsoft’s gaming site and many users that

installed Windows XP and were confused into thinking that Passport was required

(Windows XP prompts users a number of times to register with Passport, although

registration is not required). By contrast, AOL’s 30 million users pay every

month to have their user IDs. Therefore, a higher percentage of the AOL user

base can be considered active.

The breadth of commitment to Liberty gives it another momentum-based

advantage. There are many issues associated with privacy and government

regulations in pursuing I-SSO, particularly at the wallet level. The breadth or

partners offers a broad base of expertise to assist in heading off issues before

they arise. Along this line, American Express’s commitment is interesting in

that, with its Blue Card, it has made a significant investment toward an

intelligent identity and authorization infrastructure for payments, which is an

important aspect of I-SSO.

Because of the vast number of membership inquiries, Liberty is revamping its

membership cost structure to make it easy for small players to participate. This

will encourage additional momentum for Liberty. The momentum places additional

pressure on Microsoft to support Liberty and Microsoft has been backing away

from some of Steve Ballmer’s denunciations of Liberty.

Microsoft’s troubles are further compounded by recent technical debacles

with Passport. Overall, the number of Passport-enabled sites has changed little

since Liberty was announced (as reported on the Passport site’s list of member

sites). Still, very few players are ruling out the possibility of also

supporting Passport, which lessens the pressure a bit, and Liberty’s momentum

is softened by the fact that it has yet to formulate a technology direction.

The only prudent course at this point for users is to remain tactical with

any investment in I-SSO. In particular, retail Web sites considering Passport

should be aggressive both ensuring they have a short payback model and in

negotiating with Microsoft. Corporate users should wait on development of any

strategy for federating with an I-SSO infrastructure. Where it is necessary to

make tactical implementations or plans, one should assume that Liberty has the

upper hand at the moment.