The Department of Defense needs far more satellite communications capacity than it owns and thus must lease satellite communications services. Communications planners can use the "rule of thumb" set forth in this study to aid in making efficient satellite leasing decisions in the face of uncertain demand for satellite services. It is a simple, graphical technique. Extensions to the basic model show how price uncertainty and the ability to salvage unused capacity change the appropriate amount of capacity to lease. A multiple-period version of the basic model shows how planners can consider the tradeoffs between long- and short-term leases when demand grows over time.
The research described in this report was performed under the auspices of RAND's Project AIR FORCE.
This report is part of the RAND Corporation Monograph report series. The monograph/report was a product of the RAND Corporation from 1993 to 2003. RAND monograph/reports presented major research findings that addressed the challenges facing the public and private sectors. They included executive summaries, technical documentation, and synthesis pieces.
Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.