The Microsoft Account system is the way people sign up to access Xbox Live, Skype, Office 365, OneDrive and other services run by the company. In a blog post, Microsoft stated that the recent leak of over 100 million LinkedIn account details showed that many of their users had bad passwords, such as "password" "12345" and others:
When it comes to big breach lists, cybercriminals and the Azure AD Identity Protection team have something in common – we both analyze the passwords that are being used most commonly. Bad guys use this data to inform their attacks – whether building a rainbow table or trying to brute force accounts by trying popular passwords against them. What we do with the data is prevent you from having a password anywhere near the current attack list, so those attacks won't work.
This new setup is now live for all Microsoft Account users. The company says it will stop people from picking a commonly used password or one that is very similar.