Good news for the Microsoft Could and BPOS!  Microsoft annouced in February that they will be creating a BPOS offering targeted towards Federal customers as well as those in education. The press release for the annoucement event is located here.  It's important to note that these additional security layers are only available to BPOS-D customers - this is not a shared hosting offering. 

The BPOS-D Products that the Federal offering apply to are as follows -

• Exchange Online Dedicated
• SharePoint Online Dedicated
• OCS Dedicated

LiveMeeting is specifically excluded from the Federal offering.

A few of the highlights are as follows -

• FISMA Certification (cooming soon)
• Multi-factor authentication (cooming soon)
• Live ID federation for Education customers
• Enhanced encryption
• Enhanced physical security for Federal Offerings and US Citizen-only technical personnel accessing the data center.

To read more in white paper form about the BPOS Federal offering see the Microsoft website.