Single Sign-On allows your visitors to have a consistent and personalized experience.
The current approach is to encrypt and store non-sensitive information in a browser cookie that is accessed directly from the theme. This cookie data is used to do things like pre-populate comment forms based on previous user input, or otherwise personalize the viewer’s experience.
We also update our batcache configuration to bypass various caches when these cookies exist, mimicking the experience of traditional logged-in WP.com users.
The most common use-cases for this are leveraging external registration systems (such as our partners at Janrain, or your own custom system) to seamlessly interact with WordPress.com (without the need to create WP.com accounts for those users) and commenting systems like Livefyre or IntenseDebate.
For an example implementation, take a look at the FrontEnd Cookie SSO plugin.
Please contact us to explore this further, or to work out the specific technical details.