Last week the Obama Administration issued the National Strategy for Trusted Identities in Cyberspace. 

The Administration is promoting a new online “identity ecosystem”.  The way the system works is that consumers could choose to obtain an online credential (from a variety of third-party certificate providers) that serve as digital key chains to authenticate their online identities.  Thus, when consumers are engaging in online activities, such as accessing proprietary financial and medical records, a third party would serve as a type of intermediary to confirm the consumer’s identity without disclosing his or her personally identifiable information.  The third-party intermediary would verify for the online entity that Jane Doe was actually Jane Doe.  Think PayPal for ID management.  


The effort is being touted as a good thing for small- and medium-sized businesses because it will reduce losses as a result of fraudulent transactions.  A more secure ecosystem improves the e-commerce experience for everyone.  The Small Business Administration estimates that about 9 million Americans have their identity stolen every year. That has a direct impact on small- to medium-sized businesses that suffer not only the lost business, but also poor credit ratings due to excessive ID theft transactions. 
 
That is why I think that a trusted identities program that is widely adopted would be good for the users and for small- and medium-sized businesses, as well as for all other online stakeholders.  A more secure Internet promotes e-commerce and reduces costs associated with mistrust, fraud and security breaches.