With Facebook, Has OpenID Moved Closer to Being the De Facto Login Standard?

OpenID LogoFacebook today rolled out support for the digital identity standard known as OpenID, the latest and to date most successful attempt to allow users to log into a web service (from many different, sometimes competing companies) with one login and password. Scoring Facebook, one of the biggest and fastest growing login-based web sites in the world, suggests OpenID may have reached critical mass. The technology is a bit obscure, however, and widespread adoption could turn out to be nothing more than geek fantasy, yet another feature the mainstream user simply doesn’t care about

Sharing a single digital identity across multiple web sites is big business. Corporations have been trying to establish a foothold in this market for years, dating all the way back to the dot-com days. Microsoft (Windows Live ID), Yahoo and AOL have all taken cracks at it, with varying degrees of success. Both Facebook (Facebook Connect) and Google (Google Accounts) have their own proprietary ID services, as well.

Unsurprisingly, none of the major players have showed interest in supporting competing platforms — until OpenID came along, that is. Yahoo, Google, AOL, MySpace and Microsoft all support OpenID logins in one form or another, as well as a growing number of other organizations.

Web sites make significant amounts of money selling data collected from their users, including the resale of users’ emails addresses. One web site owner I spoke to, Drew Curtis of Fark.com, said he could sell the email addresses of his site’s users for 25 cents each — though he was quick to note that he does not. This is why so many sites ask if you mind receiving “messages from our marketing partners.”

With a platform like OpenID, sites can’t gather this marketing data from their readers, and as such lose a potentially significant revenue stream. That makes shared ID adoption a potentially costly proposition — notwithstanding OpenID’s promise of “lower cost of password and account management.”

Having one standard digital identity might be good for users, but “there’s a lot lined up against a unified account service,” Curtis told me. “The killer app would be something like OpenID that implicitly allows sites to scrape personal data” and make money off it.

OpenID has the backing of most of the big names in the industry, and is primed for success like no other login service before it, but whether it receives widespread adoption from thousands of web sites currently asking users to set up proprietary logins remains to be seen.

What does OpenID mean for Facebook? At the end of the day, not much. The site has managed to get 200 million users without OpenID, so it is unlikely the site will get a big bump in traffic — but it does suggest that Facebook is willing to play nice with the rest of the web, rather than being the bully in the sandbox. Maybe.

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