More Users Signing Up for Microsoft Passport

In a survey conducted by Gartner, it shows that Microsoft has managed to double its number of registered Passport users in just six months, from seven million in August 2001 to 14 million in February 2002.

However, the research and advisory firm believes that Microsoft’s requirement that customers use the Passport service to access its other offerings – such as Hotmail, Windows XP, and Microsoft Messenger – is a much more powerful incentive for registration than Passport’s features.

“Consumer demand typically drives the adoption of new products and
services. But the rollout of Passport services is clearly not following
that general rule,” said Dion Wiggins, research director at Gartner. “Most
consumers are signing up because they have to and not because of a strong
interest in the convenience features Passport offers.”

The survey revealed that 84 percent of consumers surveyed as of February 2002 said they registered with Passport because it was required to do so in order to use other Microsoft services. That compares with 61 percent who cited the same reason in August 2001.

In contrast, two percent of consumers surveyed in February 2002 said they signed up for Passport so that they could avoid multiple IDs and passwords, compared with 16 percent who said the same thing in August 2001.

Still, Microsoft benefits from the relatively high levels of consumer trust when compared to other companies offering competitive or complementary services.

Banks get the highest consumer vote of confidence when it comes to running an identity or e-wallet service (47 percent). Microsoft came in second (12 percent), ahead of credit card issuers (eight percent).

Wiggins said Microsoft’s rollout of its Passport is critical to the company’s Web services strategy. The more Passport users Microsoft enrolls, the more Web servers and services it sells to companies supporting Passport and the more mass audience it commands.

“This, in turn, will help Microsoft earn higher advertising revenue, more lucrative
affiliate deals, and potential customer referral transaction fees in the
future,” said Wiggins.

He added: “Passport is considered an essential piece of infrastructure in Microsoft’s bid to sell software as Web services, which is part of its overall .NET strategy.”