SignalR not working with Windows-integrated authentication

Update from 2020: looks like Chrome now supports NTLM on WS-connections, not an issue any more

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...10 hours later after asking the question...

Partially solved (answering my own question)

After playing with it I can confirm, that adding the [Authorize] attribute to my hub (or alternatively, adding GlobalHost.HubPipeline.RequireAuthentication(); to your "Startup.cs") actually does help. It does fall back now to an alternative transport, even though the error is still thrown into the browser's console.

You can also specify which transport it falls back to, by calling:

$.connection.hub.start( { transport: ['webSockets', 'longPolling'] });

in case you don't like the default priority (I guess, "hidden iframe" is the default second option).

The reason

The error is caused by Chrome, it does not support NTLM on websocket connections. Funny enough, IE, MS Edge and Firefox do support it ("Chrome is the new IE" huh).

There's an open issue in Chromium bugtracker for this here https://bugs.chromium.org/p/chromium/issues/detail?id=423609 if anyone wants to add any input to Chromium devs.

I too was experiencing this error, but only when developing locally using http; I think Chrome doesn't like unsecured ws:// connections. Once I deployed to server with secure https connection, the WebSocket connection was upgraded to wss://, and Chrome stopped complaining, worked fine with WebSockets--didn't have to fall back to other transport.

tl:dr; Make sure to use https for your site.