Economic Tussles in Federated Identity Management

Federated identity management (FIM) enables a user to authenticate once and access privileged information across many disparate domains. It is a technology of great promise whose adoption has been disappointing. FIM’s proponents include both governments and leaders in the IT industry. Many explanations have been given for its slow uptake, from disputes over liability assignment for authentication failures to concerns over privacy. We present an economic perspective on stakeholder incentives that can help shed light on why some applications have embraced FIM while others have struggled. By presenting seven use cases of successful and unsuccessful FIM deployments, we identify four critical tussles that may arise between stakeholders when engineering a FIM system. We show how the successful deployments have resolved the tussles, whereas the unsuccessful deployments have not. We conclude by drawing insights on the prospects of future FIM deployments.