Microsoft has long offered U.S. government agencies a special version of its Azure cloud computing platform that has all the necessary certifications to allow federal, state and local agencies to use its services. Today, it’s expanding this service with the launch of a Department of Defense-specific version of Office 365 and Azure, and the launch of two new Azure Government regions is the South West and South Central United states.

The new versions of Azure and Office 365 for the Department of Defense (DoD) will run in two new dedicated regions where they are physically isolated from the rest of the Azure platform. Microsoft says these regions will also be connected to the DoD using a private Azure ExpressRoute connection.

Microsoft’s cloud was already certified to handle data up to DoD Impact Level 4 (that’s controlled but unclassified data, like export controlled information, privacy information and protected health information). The company says it is now on track to get to DoD Impact Level 5 for both Office 365 and Azure in these new DoD regions (that’s still mostly unclassified data, but includes unclassified National Security Systems data, among other things). Amazon’s AWS GovCloud is currently Level 4-compliant. I’m not aware of Google having any Impact Level certification, but I’ve reached out to the company to confirm this.

Talking about the company’s government customers, Microsoft’s corporate vice president for cloud marketing Julia White told me that what she is seeing is that “they all now have a cloud strategy in place — which is an evolution from just a few years ago.” Just like many mainstream businesses are now moving to the cloud, so are many government agencies on every level. A few years ago, the conversations still centered around what the cloud really was and what it could do for these agencies. “Now they are are having the more interesting conversations,” White said. Many of these agencies are now looking at moving their productivity suites online — and with Office 365, Microsoft can offer them a solution with which most of their employees are already familiar. As for moving other workload to the cloud, White noted that Microsoft is seeing a lot of dev and test environments, but also many citizen-facing services.

At this point, Microsoft has achieved most of the standard certifications that allow government agencies to use its cloud services (think HIPAA, FedRAMP, etc.). White tells me that at this point, a lot of the discussions are around meeting the very specific needs of local agencies (think the Indiana Department of Education).

Microsoft also had a bit of non-government cloud news today: SAP is expanding its partnership with Microsoft and making its SuccessFactors HR solution available on Azure.