I agree bitcoin may not be the correct place for identity as it only allows a small amount of extra data stored in the blockchain.
But as the article states there are different types of identity.
The backbone of Bitcoin is the public private key pair.
Something can be signed by your private key and anyone can check that you really did sign it with your public key.
There are uses cases this could help with in identity such as providing data provided is genuine and yours. Such as a utility bill, passport driving licence etc.
Now if we used something like the storj network (or ideally the maidsafe network although that is not ready) which allows files to be added, and shared on the decentralised network.
For instance if the issuer of a utility bill made its corporate public key known. And signed a transaction containing a file containing your utility bill (perhaps a pdf) and sent it on the blockchain to your known public key.
When you are trying to prove your address or bill amount etc to a different third party they can verify that you are the owner of your public key by sending a code encrypted with your public key that only you could decide and prove. And they could verify that the source of the file was I'm fact the utility company so the data is genuine it's then proven. This could be applied in a very similar way to driving licence, passport, house deeds, pay slips.
Things to consider would be making the files private and sharable if necessary to the entity you are trying to identify yourself to. But this is achievable on the maidsafe network and potentially with some work.on the storj network.