PARIS — Four commercial satellite industry veterans have formed a company designed to match aging in-orbit satellites whose owners are willing to lease them with satellite operators in need of short-term capacity in advance of launching their own asset.

Gapsat Development Group Ltd., headquartered in the British Virgin Islands, expects to broker its first deal this year, said Gregg Daffner, the startup’s chief executive.

“You can think of what we are doing as similar to the aircraft-leasing business,” Daffner said in an April 14 interview. “Airlines lease planes to adjust their fleets to demand, and there is no equivalent to this in the satellite industry.”

As a co-founder of satellite fleet operator Asia Broadcast Satellite of Hong Kong, now known as ABS, Daffner is well-versed in the business of wringing value from satellites whose original owners no longer need them. ABS has built its business, until recently, through the purchase of aging spacecraft whose owners’ business focus has moved elsewhere, or whose fleet development has made the older satellites irrelevant to their business.

Gapsat’s chief operating officer is David M. Gilmore, a former deputy chief executive of satellite fleet operator Telenor Satellite Broadcasting of Norway. Richard Barnett, who runs the Telecomm Strategies Inc. satellite regulatory and engineering consultancy in Washington, is Gapsat’s chief technical officer.

The latest addition to Gapsat’s management team is Mark Rigolle, former chief executive of satellite broadband operator O3b Networks, and before that chief financial officer of SES of Luxembourg, the world’s second-largest commercial fleet operator by revenue. Rigolle’s arrival at Gapsat, announced April 14, is a signal that the company has reached a point where its business plan is sufficiently developed to seek outside financing, which is where Rigolle’s expertise lies.

Daffner said there are numerous in-orbit satellites available on the market. The trick, he said, is to find those spacecraft whose antenna configurations and radio frequency capabilities fit well with prospective Gapsat customers. 

Leasing in-orbit satellites for short-term business needs is not new. Up to now, the transactions have occurred directly between satellite owners and the companies looking to add capacity. 

Gapsat’s business model is to add value to a transaction through its arm’s-length distance from both parties. 

“Sellers have a tendency to overvalue their assets,” Daffner said. “What we offer is a neutral view. We are not a competitor to the satellite operators.”

There are multiple reasons that a satellite operator, either new or more established, would seek to lease capacity. A company may discover that, for example, the move from standard-digital to high-definition television in its customer base means more satellite bandwidth is needed. 

It typically takes two to three years to design, build and launch a satellite, and the lease would cover this period from when a business case is identified to when a dedicated satellite can be launched to serve it.

In the event of a successful lease brokerage, Gapsat would take a percentage of the transaction’s revenue.

Another example of why companies in the past have resorted to leasing satellites is when a regulatory deadline for occupying an orbital slot is arriving more quickly than the financing for a new satellite’s construction and launch. The International Telecommunication Union (ITU), a Geneva-based United Nations affiliate that regulates radio spectrum and orbital slots, is engaged in a multiyear effort to oblige satellite operators to say what they do, and do what they say. 

Deadlines for “bringing into use” a satellite position and its associated broadcast frequencies have been made stricter as the ITU seeks to impose law and order on what remains, in many ways, an industry with a frontier mentality.

Daffner said that ultimately Gapsat would seek to purchase its own satellites, with maximum antenna-configuration flexibility and frequency switching built in. That next step is several years away, but the company has begun to scout prospective regulatory homes, he said.

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Peter B. de Selding was the Paris Bureau Chief for SpaceNews.