Introduction
In the modern context, businesses find themselves grappling with the identity challenges of dealing with both on-premises setups and cloud setups. B2C customer identity and access management solutions for a business's Azure infrastructure comes with strong hybrid identity solution support. Modifying the identity infrastructure of an organization that is still conducting its business operations is made easy with the hybrid identity solution.
This blog outlines the integration of on-premises with Azure Active Directory B2C, the good and bad aspects of hybrid identity, and its most beneficial use cases.
What is Hybrid Identity in Azure AD B2C?
Hybrid identity in Azure AD B2C means the coexistence of on-premises identity systems, taking the premise as Active Directory (AD) with Azure AD B2C. This would let the organizations extend their existing identity management framework to the cloud and hence maintain continuity for their users while enjoying the advanced features of Azure AD B2C.
Key components of a hybrid identity solution include:
How Hybrid Identity Integration Works
Integrating on-premises identity systems with Azure AD B2C requires establishing secure communication and authentication methods. Since Azure AD Connect is not supported in Azure AD B2C, organizations must use alternative approaches such as federation, REST API Authentication, and custom policies.
1. Federation with Existing Identity Providers (Recommended Approach)
Organizations can integrate on-prem Active Directory (AD) with Azure AD B2C using SAML 2.0, or OAuth 2.0/OpenID Connect. This enables users to sign in with their existing credentials while benefiting from Azure AD B2C's customer identity and access management (CIAM) features.
How It Works
- Azure AD B2C redirects authentication requests to the existing on-prem IdP (such as AD FS or a custom OAuth/SAML provider).
- The on-prem IdP authenticates the user and issues a security token.
- Azure AD B2C validates the token and grants access to cloud applications.
Use Case
- Organizations that already use AD FS, PingFederate, or another IdP can easily extend authentication to Azure AD B2C.
- Seamless Single Sign-On (SSO) experience across on-prem and cloud applications.
2. REST API for Authentication & Attribute Retrieval
Azure AD B2C can invoke REST APIs hosted on-premises to validate user credentials or read more user attributes at the time of authentication. This is a typical trend in migrating existing applications or performing a Just-in-Time (JIT) migration approach.
How It Works
- The user enters their credentials in the Azure AD B2C login page.
- Azure AD B2C calls an on-prem API to validate credentials against an on-prem identity store (such as an LDAP database).
- If valid, the API returns user attributes, and Azure AD B2C creates a new account (JIT migration) or retrieves additional profile details.
Limitations
- Azure AD B2C does not directly authenticate against on-prem AD or LDAP—you must build an API middleware for this.
- API-based authentication can introduce latency if not optimized.
Use Case
- Gradual migration from on-prem AD to Azure AD B2C (JIT Migration).
- Applications that require additional attributes stored in legacy databases.
3. Custom Policies for Complex Hybrid Identity Scenarios
Azure AD B2C custom policies can be utilized to handle intricate situations such as:
- Integrating multiple identity providers (on-prem IdP + social logins + external OAuth providers).
- Fetching/verifying attributes stored in on-prem systems or legacy databases.
- Implementing conditional access policies based on user attributes or device status.
How It Works
- Custom policies define authentication orchestration rules using REST API calls, identity providers, and attribute transformation, allowing for fine-grained control over authentication and user journeys.
Limitations
- Requires custom XML configuration (not as simple as built-in user flows).
- Does not support direct LDAP authentication—must use an API or IdP instead.
Use Case
- Organizations needing advanced authentication customization beyond standard user flows.
- Combining multiple authentication sources (e.g., on-prem AD + Azure AD B2C + third-party IdP).
Advantages of Hybrid Identity Solutions
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Gradual Migration
Hybrid identity allows organizations to transition from on-premises systems to Azure AD B2C incrementally. This minimizes disruption and ensures continuity for users and applications.
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Leverage Existing Investments
Integrating with on-premises systems allows businesses to extend the value of their existing identity infrastructure and deliver its capabilities into the cloud.
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Strong Security
Azure AD B2C provides additional layers of security with MFA and conditional access on top of any existing identity system.
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Seamless User Experience
Users can maintain familiar credentials and authentication workflows and, therefore, experience minimal friction during the transition.
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Compliance and Control
Hybrid identity allows organizations to meet their compliance requirements by storing sensitive information on-premises while utilizing the scale and reliability of Azure AD B2C.
Challenges and Gotchas
When to Use Hybrid Identity Solutions
Hybrid identity solutions are best in these enterprise scenarios:
Best Practices for Hybrid Identity Integration
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Plan for Incremental Migration
Start by migrating low-risk or non-critical user groups to Azure AD B2C. Gradually expand to other user segments as processes stabilize.
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Optimize REST API Calls
Cache frequently accessed data to reduce the load on on-premises systems and minimize latency during authentication.
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Monitor Synchronization
Azure AD B2C does not support Azure AD Connect for synchronizing on-prem AD users.
Instead of synchronization monitoring, organizations should focus on monitoring federation, API calls, and authentication logs in Azure AD B2C logs (via Azure Monitor or Application Insights). -
Secure API Communication
Implement secure protocols like HTTPS for all API communications between Azure AD B2C and on-premises systems.
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Test and Validate
Conduct thorough testing of authentication flows, attribute synchronization, and conditional access policies before rolling out to production.
Advantages vs. Disadvantages
| Aspect | Advantages | Disadvantages |
|---|---|---|
| Gradual Migration | Reduces disruption during the transition. | Prolongs the migration process. |
| Security | Leverages advanced Azure AD B2C features like MFA and conditional access. | Potential security risks if federation is misconfigured. |
| User Experience | Provides a seamless experience with familiar credentials. | May introduce latency in authentication workflows. |
| Cost Efficiency | Hybrid Identity extends the value of existing on-premises infrastructure by allowing gradual cloud adoption instead of full replacement. | Additional costs for hybrid infrastructure and licenses. |
| Compliance | Hybrid Identity meets regulatory requirements by allowing organizations to keep sensitive data on-premises while using Azure AD B2C for authentication. | Requires ongoing monitoring of authentication policies, federation security, and access controls to ensure compliance across environments. |
Conclusion
Hybrid identity solutions can bridge the gap between on-premises infrastructure and Azure AD B2C. They allow organizations to transition their identity management framework to a modern environment with minimal disruption. Businesses can establish a seamless, secure hybrid identity model using federation (SAML, OpenID Connect), REST APIs, and custom policies to integrate on-premises and cloud authentication.
Of course, hybrid identity introduces challenges that require organizations to carefully plan and execute their integration strategy to reduce complexity, mitigate latency issues, and ensure compliance. Approaching these solutions with a focus on scalability, security, and flexibility will help businesses adapt to evolving identity management needs while maintaining operational continuity.
