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Microsoft Announces Government Cloud

The Business Productivity Online Suite Federal is hosted on a government-dedicated infrastructure in secured facilities within Microsoft's own data centers.

Microsoft is now offering a dedicated government cloud service, hosted in secure, dedicated facilities and designed to meet the particular security, privacy, and compliance needs of government agencies, the company announced at its annual U.S. Public Sector CIO Summit Wednesday.

The Business Productivity Online Suite (BPOS) Federal, includes Exchange Online, SharePoint Online, Office Communications Online, and Live Meeting, just like the standard BPOS, but is hosted on a government-dedicated infrastructure in secured facilities within Microsoft's own data centers.

"These enhancements raise the bar around compliance and security in our BPOS services," Ron Markezich, VP of Microsoft Online, said in an interview. "We've had enterprise customers on this for up to five years, and some of the most demanding multinational companies in the world on this. This is ready for the government today."

The new hosting facilities will be compliant with International Traffic in Arms Regulations (ITAR), so access will be limited to U.S. citizens who have gone through background checks complete with fingerprinting.

Additionally, Microsoft announced that it has achieved compliance certifications for a number of key regulations important to both government and business. These include: International Organization for Standardization (ISO) 27001, Statement on Auditing Standards (SAS) 70 Type I and Type II, Health Insurance Portability and Accountability Act (HIPAA), Family Educational Rights and Privacy Act (FERPA), Title 21 CFR Part 11 of the Code of Federal Regulations, Federal Information Processing Standard (FIPS) 140-2, and Trusted Internet Connections (TIC).

In an interview, Microsoft Online VP Ron Markezich said Microsoft expects to achieve Federal Information Systems Management Act (FISMA) certification within 6 months.

New capabilities are also on the way for both government and business customers, including enhanced encryption, two-factor authentication, new rights management features, and something called the "master administrative console" where users can, for example, administer state or federated agencies like their own islands within a particular instance of BPOS.

The offerings come at a time when federal CIO Vivek Kundra is actively steering the federal government and parts of its $79 billion annual IT budget toward cloud computing.

Many federal agencies are grappling with how and where to adopt the cloud computing model and how it will fit into federal IT's laundry list of regulations.

Microsoft probably isn't alone in thinking about government-specific cloud services. Amazon, for example, has 110,000 square feet of leased data center space in northern Virginia. "I am looking forward to working closely with the Federal CIOs to make sure our services can meet the requirements that can make them successful in their quest," Amazon CTO Werner Vogels wrote in a blog post last September.

Among the early government BPOS customers is Newark, N.J. Newark was ready for an e-mail upgrade and tired of major problems with downtime with its on-premises Exchange Servers, and after analyzing the cost of in-house, hosted and cloud-based e-mail, it found that, even as part of a suite alongside other products, Exchange Online would save Newark more than $200,000 over three years because Newark will be able to avoid costs for consulting, new hardware, anti-malware and maintenance.

Mike Greene, the city's assistant business administrator and CIO, sees other benefits as well. Microsoft has promised 99% uptime and his users will now get 5 Gbytes of storage space, much more than the sub 1 Gbyte storage they have now. Additionally, Newark now plans to upgrade its Intranet by using SharePoint Online, and hopes that having e-mail as a service will free up its IT pros to work on higher business value projects.

The city recently finished a 75-user pilot, and hopes to roll out Exchange Online to all 1,700 users, including those on Blackberries, by the middle of March.

Newark joins 48 of the 50 states and more than 500 customers in the public sector in whole, including groups the British postal service, as BPOS customers. Microsoft has yet to sign up any major U.S. federal agencies for agency-wide use of BPOS, but BPOS is already available on, and Markezich said the company is "far down the road" in discussions with several agencies.

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