Microsoft Repositioning Passport ID System

In a move seen by some as a return to its pure software roots, Microsoft is going to limit its .Net Passport identification system to its own online offerings and those of “close partners,” seeing Passport no longer as a simple Web-at-large sign-on system.

This would be a considerable turnaround considering Microsoft once considered Passport a critical part of its hosted services strategy but kept quiet about the authenticator in the past few years, doing little if any significant work on it but scaling back several components. Microsoft dropped a directory of supporting sites this year, and in early 2003 it dropped a payments feature.

The key problem, according to analysts: It was one thing for Microsoft to imagine thousands of online stores and services using Passport but something else to convince those stores and services that using Passport wasn’t letting Microsoft take over the online sales and service world. Extremely few sites not owned by Microsoft actually signed on to use Passport. Recently, online job-hunting giant Monster.com decided to drop its support for the service.

But Microsoft may have learned a few key lessons from working with those who did use Passport, according to MSN lead product manager Brooke Richardson. "Going forward, the mission of the Microsoft Passport service will be to provide authentication services to Microsoft services and products and to Microsoft partners," she said in an email to the press.

Directions on Microsoft, a Washington state tracking and analysis firm that focuses on Microsoft, thinks that’s the smart move for Microsoft. "Microsoft's interest in hosted services has decreased since 2001,” said Directions spokesman Matt Rossoff. “The company's focus has returned to software, which is where it belongs."