Microsoft abandoned Passport yesterday, except for it's own web sites. As a programmer, it was a pain in the ass to use. As a consumer, I didn't want to tie all my purchases across multiple web sites together. So whenever I ended up on a site that required Passport, I created entirely new passports (hurray for having unlimited email accounts). As a web site operator, you don't want to lose control of your customers to microsoft either. And sometimes you might not even want Microsoft to know who your customers are.
It was a bad idea all around, for everyone except Microsoft. That is if they could pull it off. Since they didn't, it turned out to be a bad idea for them.
Monopolists don't always win.