From Diablo Wiki
Once Identify All begins, the character goes into a casting animation and a progress bar appears overhead. At the conclusion of the time (five seconds) all unidentified items (Rare, Set, and Legendary) in the inventory are identified.
There is no way to exclude any item in the Inventory from being identified, so if a player wishes to keep an item unidentified, it must be removed from the inventory before using this feature.
- See the Identify article for more general information.
The identify all feature was added in response to months of player requests, and provided a much quicker method of identifying gear. Many players report picking up more Rare items after the ID All feature was added, since the time wasted by identifying items individually was cut so drastically.
Prior to ID all, each Rare item took 1 second and each Legendary item took 3 seconds to identify, and they had to be IDed one at a time.