Does Windows Live ID or Hotmail (Passport) support OpenID based authentication?
If yes, what is the endpoint url, and do I have to register my application somewhere to use it?
If no, do they have their own API for 3rd-party authentication?
On the Windows Live Blog, there are only two different mentions of Open ID. Neither of those point to any actual movement on implementing Open ID.
There is no mention of a working Microsoft provider on the OpenID Web Site. Even though Microsoft is part of the OpenID board, it seems they are only adding OpenID support within Microsoft products.
There was the mention of an experimental OpenID provider from Microsoft back in 2007, but the web site isn't working. In addition, there was another experimental OpenID provider for Windows Live, but it was shut down in 2009.
I believe that with the death of Windows CardSpace in February 2011 and the purchase of Credentica, it sounds like Microsoft is jumping out of the OpenID bandwagon in favor of a proprietary solution.
Source: http://en.wikipedia.org/wiki/Windows_Live_ID#Support_for_OpenID
Support for OpenID
On October 27, 2008, Microsoft announced that it was publicly committed to supporting the OpenID framework, with Windows Live ID becoming an OpenID provider. This would allow users to use their Windows Live ID to sign-in to any website that supports OpenID authentication. There has been no update on Microsoft's planned implementation of OpenID since August 2009.
The project has been planned a few time ago, but it seems not to be implemented.
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