Why there is no single sign on with Windows Live ID? It is also a widely used ID provider.
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Back when Stack Overflow was still quite young, there were rumors and some reasonable expectation that Windows Live ID would actually implement support for OpenID-based authentication.
If this had happened, Stack Exchange would support it, just like it supports every other (non-broken) OpenID provider. But it didn't
Sure, it would be possible to add support for it... SE can authenticate via OAuth 2.0, and I hear tell Windows Live supports this now... But there'd have to be enough potential users to make it worthwhile, folks who don't already have an account on Google, Facebook, or one of the myriad other providers already supported.
In the end, it's probably just easier to ask the minority of users who don't already have an OpenID of some sort to go get one.