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Read/WriteWeb has an overview of identity verification services. Having worked with Trufina and Opinity, I am intimately familiar with how they operate and current issues that need to be addressed if these companies hope to succeed.

At first, background checks were a solution looking for a problem. The thinking was along the lines of “We do checks for major corporate HR departments, why not branch out into other (seemingly) logical markets?�

Bzzzt. Wrong answer. None of these companies knew the first think about dating or social networking, and it showed, sometimes painfully, during their pitches to dating site business development teams.

That was two years ago.

Now Sentinel is providing searching capabilities to MySpace’s sex offender alert system. MySpace may use image-analysis software and other means whereby sex offenders using MySpace can be recognized, even if they don’t use their real names in registering. I talked to Riya about using their facial recognition on dating sites for matching purposes, as I understand it talks are underway with most large dating sites although I’m not clear on the status.

Sometimes you need to stare at a problem for a while before the solution becomes apparent. The problem is that others are reacting quicker to changes in the marketplace and launching competitive services for most less cost and overall resources.

I recently heard from Harrison Tang at Spokeo. Spokeo is a content and profile aggregator built by Stanford roommates. No VC, no big development team. Just a few smart people in close proximity learning from the mistakes of others who previously trod down a similar path.

This madness with 20+ profiles is ridiculous and borders on insulting. I can only hope that dating sites will allow for a Master Profile which can be shared among several sites and manageable via a centralized site.

Lots of entrants into the marketplace, everyone is having a hard time monetizing traffic. Either you make money on identity or background checks or advertising. So far, we’re not seeing a lot of either, but it’s early days for identity companies. There are plenty of them in the deadpool. As usual, it’s going to take timing and a unique value proposition to succeed.

• Mainstream Media Best Marketing for Background Checks
• Review of identity verification vendors
• iKarma Selects PhoneConfirm for Enhanced Identity Verification
• Digital ID World Conference
• GetogetherSafe.com identifies Intelius for ID verification