Google Inc released a special version of its Web-based productivity software designed to meet stringent U.S. government security requirements, as the Internet search giant seeks to outmaneuver rivals in the race to provide federal and state agencies with new technology.

Google said on Monday it was the first company to offer email, calendaring and other “cloud-based” software products with a special government certification vouching Google's systems and practices meet hundreds of federally-mandated security controls. The new version of Google Apps comes as the company continues to work with Los Angeles officials to address security concerns relating to an existing contract to provide city employees with Web-based software. Google said it was working with the city of to address its evolving security and functionality requirements.

Google said on Monday it achieved certification under the Federal Information Security Management Act on Thursday. The certification means Google can handle government information deemed sensitive, but not classified, according to Google. In addition to the FISMA requirements, Google said the special government-version of the software will store all email and calendar information on servers hosted within the continental United States. And the servers hosting government data will be physically segregated from servers used for corporate customers.

Chief Executive Eric Schmidt said at a news conference on Monday the certification will give government agencies the green light that they need to adopt Google's online software. “We have a hot product, what we're doing is knocking down barriers to adoption,” said Schmidt, noting demand among government agencies for Google's cloud-based software is “enormous.” Roughly one dozen federal agencies are already testing Google's new government-grade version of the software, Google said, and the company expects the product to appeal to state and local governments as well. Google's new Apps for Government will offer the same catalog of Web-based products that Google has offered to corporate customers for several years and will be priced the same way: $50 per user per year.

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