CIO Magazine is announcing today that Microsoft’s Open Source Lab will create a Firefox extension to support Windows CardSpace, Microsoft’s solution for identity management.

CardSpace aims to solve one of the major burdens in our digital lives: managing separate identities in different services such as web email providers, e-stores, banks and other services. On a CardSpace ideal world, a user would only have to register once with an identity provider and from then on, CardSpace supporting service provider (relying parties) will check out identity with the identity provider instead of keeping a closed users’ database.

CardSpace is not the only option for identity management. OpenID is another solution being actively developed and support requested for Firefox as well. Let’s hope 2007 becomes the year we say bye bye to password insanity.