Google vs. Microsoft: The Pay’s the Thing

Today, Google released the Account Authentication Proxy for Web-based applications, which allows an application to access a Google service protected by a user’s Google account. This is basically Google’s answer to Microsoft Passport / Windows Live ID.

With the new Google service, users can allow a Web site or application limited access to their Google account info. Users must log into their accounts using a Google-supplied log-in page. The Web site or application can then access certain information associated with that user’s Google account, such as Google Calendar info or Gmail. You have to explicitly authorize applications to access your Google info.

Also today, Microsoft has released the beta of something called Digital Locker, which helps Passport/Windows Live ID users to buy software from Windows Marketplace.

Now as you may or may not know, Microsoft is currently replacing Passport with something called Windows Live ID. Passport and Windows Live ID are basically single sign-on and secure validation mechanisms for Microsoft’s Web-based services.

Passport was a Microsoft idea that was slightly ahead of its time. Although it has been successful, there haven’t been enough powerful services to tie together under the Passport roof until now. These days, however, ubiquitous Internet advertising (a market Microsoft hopes to play in with AdCenter) and the plethora of services attached to that advertising (buying and selling, fulfillment, etc.) have made the concept of single sign-on much more attractive. Connected to Windows Live ID is something called Windows Live Wallet, which is apparently Microsoft’s micropayments service. Nobody seems exactly sure how Windows Live Wallet will work yet.

Google, of course, has had its eye on the single sign-on and online payment prize for many years. Each new application Google launches requires sign-in. And, if I’m signed in to Gmail, I’m also signed into Calendar, and Reader, etc.

Herein may lie the real power of GBuy. If users are already signed into their Google accounts, and GBuy automatically works with those accounts, then Google immediately has a huge installed base.