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To make use of it you require a directory server for user accounts which can be accessed by LDAP (which is the just the protocoll to communicate with it).
Bottomline is to allow companies(or whatever) with many applications that need authentication to have one place to store and manage user data instead of in any of their systems for the nth time.
A little more technical
:
http://www.zytrax.com/books/ldap/ch1/At least thats what i figured from having a glimpse in the past. Never got deeper into it.
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