When an IIS application
you must set the SPN for the HTTP service under the domain account.
In this scenario, you access the IIS application by using either the NetBIOS name of the server that is running IIS or the FQDN of the server that is running IIS.
Setspn –S HTTP/NETBIOS_NAME_OF_IIS_SERVER domain\username
* Reference http://support.microsoft.com/kb/929650
To enable the Negotiate process to select the Kerberos protocol for network authentication, the client application:
If the client application does not provide a target name, the Negotiate process cannot use the Kerberos protocol. If the Negotiate process cannot use the Kerberos protocol, the Negotiate process selects the NTLM protocol.