The new Microsoft two-step has the same code verification process. You can also set up old-fashioned security questions.
The system helps protect your account from hackers by requiring two pieces of information before you can access it—usually your password and something else. Both Google and Facebook use a system whereby after correctly entering your password, the system sends an additional code to your phone. That way somebody needs both your password and your phone to get into your goods.
Previously, Microsoft had two-step verification for credit card activities at commerce.microsoft.com and xbox.com as well as for accessing your SkyDrive from an unknown computer. Those steps are required for your safety. The new optional service will help secure access to all any product connected to your account across web, mobile, and desktop platforms. [Microsoft]
Microsoft Will Finally Offer Two-Step Verification For Your Entire Account