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For the local KDC solution, will it support anything other than password-based authentication? From previous presentations on NTLM deprecation, the information I've received is that no thought was put into supporting the Kerberos PKINIT extension required for smartcard authentication. I would really like to see smartcard authentication become an option for workgroup machines and I would be more than willing to test it.
We have no plans to support PKINIT for workgroup at this time. PKINIT requires a non-trivial infrastructure deployment for PKI and if customers want to use PKI, they should consider deploying AD.