FedRAMP
FED-ramp
The US federal program that standardizes security assessment and authorization for cloud services used by government agencies.
FedRAMP (Federal Risk and Authorization Management Program) is the US government's framework for evaluating cloud service security. If you want to sell your SaaS product to federal agencies, you need FedRAMP authorization.
The program has three impact levels: Low, Moderate, and High, based on the sensitivity of the data. Moderate is the most common. Authorization involves a rigorous assessment against hundreds of security controls derived from NIST SP 800-53. A third-party assessment organization (3PAO) evaluates your systems, and a government agency sponsors your authorization.
FedRAMP is expensive and slow. The process typically takes 12-18 months and costs $500,000 to $2 million or more. But it unlocks the massive US federal market. AWS, Azure, and GCP all have FedRAMP-authorized regions. Companies like Salesforce, ServiceNow, and Splunk invested in FedRAMP because federal contracts are worth the compliance effort. Most companies already have SOC 2 and ISO 27001 before pursuing FedRAMP.
Examples
A SaaS company pursues federal customers.
A Department of Defense prospect tells the sales team they need FedRAMP Moderate authorization. The company estimates 14 months and $1.2 million to achieve it. They weigh the cost against a potential $5M annual contract.
A company achieves FedRAMP authorization.
After 16 months, the company receives its Authority to Operate (ATO) from a sponsoring agency. They are listed in the FedRAMP Marketplace, making them visible to all federal buyers.
A startup decides to skip FedRAMP for now.
The startup's TAM analysis shows their product serves 50 potential federal agencies. The $1.5M FedRAMP investment does not make sense at their current stage. They focus on commercial customers and revisit FedRAMP at $50M ARR.
Frequently asked questions
How long does FedRAMP authorization take?
Typically 12-18 months from start to finish. This includes preparation (3-6 months), the 3PAO assessment (3-4 months), remediation of findings (2-4 months), and the agency review and ATO issuance (2-4 months).
Is FedRAMP required for all government sales?
For federal agencies using cloud services, yes. State and local governments do not require FedRAMP, though many use StateRAMP or accept FedRAMP as meeting their requirements.
Related terms
An auditing standard that evaluates whether a company's systems meet trust service criteria for security, availability, and confidentiality.
An international standard for information security management systems that provides a framework for managing and protecting sensitive data.
The US federal law that sets standards for protecting sensitive patient health information from disclosure.
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