When you use Windows Integrated Authentication (NTLM or NT Challenge Response) to try to access a password-restricted part of a Web site that is hosted on a Microsoft Internet Information Services Web server, you are denied access. You receive one of the following error messages in FrontPage:
NTLM authentication failed (code -2146893048).
-or-
The server sent a response which FrontPage could not parse. If you are trying to connect to a FrontPage server, check with the server's administrator to make sure the FrontPage server extensions are installed properly.
NOTE: In this scenario, Basic Authentication still works, which indicates that this not a permissions issue. (NTLM also requires the "Access This Computer from the Network" user right.)