Sorry, I did not blog for quite a while.
When looking at the Cloud, one of the key challenges to address - in my opinion - is how to manage the identity of the different users. If you have to add an additional identity to all the logons you already have, the Cloud will just add to the burden. Therefore, I am a firm believer that you need to have federation between your on-premise identity and your cloud identities.
We just released a paper Office 365 Single Sign-On with AD FS 2.0 whitepaper on how to address this with Office 365 and ADFS 2.0:
Through its support for the WS-Federation (WS-Fed) and WS-Trust protocols, Microsoft Active Directory Federation Services (AD FS) 2.0 provides claims-based (Web) single sign-on (also known as identity federation) with the Microsoft Office 365 offering and its Web application and rich client applications.
Building on existing documentation, this document is intended to provide a better understanding of the different single sign-on deployment options for the services in services in Office 365, how to enable single sign-on using corporate Active Directory credentials and AD FS 2.0 to the service in Office, and the different configuration elements to be aware of for such deployment.
This document is intended for system architects and IT professionals who are interested in understanding the basics of the single sign-on feature of Office 365 with AD FS 2.0 along with planning and deploying such a deployment in their environment.
You should have an in-depth look at this