Japan has chosen a Rakuten proposal for its Japan Low-Earth Orbit Satellite Communications Project, known as J-LEO, and Rakuten and AST SpaceMobile are forming a joint venture to run it. The venture, Rakuten AST, will buy satellites from AST and operate a direct-to-device network that connects ordinary phones to space, managed and run inside Japan. Reports put the government money flowing to it at about $1 billion over three years.
Rakuten will hold 51% of the voting rights and AST’s Japanese subsidiary 49%. The company is being set up this month in Tokyo with 100 million yen of starting capital, under CEO Ryoji Osaka. AST SpaceMobile shares jumped about 17% on the news.
Why a sovereign constellation
The public framing is disaster resilience. Japan lives with earthquakes and typhoons that knock out ground networks, and a phone that can reach a satellite directly keeps working when the towers don’t. That alone justifies the spending politically.
The security case sits underneath it. Today the only large direct-to-cell service is SpaceX’s Starlink, which already works with KDDI in Japan. A government that wants a fallback network in a crisis, including a regional military crisis, doesn’t want that network owned and steered from abroad. J-LEO puts the satellite capacity on Japanese terms, run by a Japanese-majority company under Japanese law. Japan’s defense planning has leaned hard on space and communications resilience since its 2022 strategy documents, and this is the civil side of the same idea.
What AST gets
For AST SpaceMobile, the deal is a template. The company has sold its satellites mainly as a service for mobile carriers, with AT&T, Verizon and Vodafone among its partners. J-LEO turns the same hardware into a sovereign product: a country buys a constellation it controls, and AST supplies and helps operate the spacecraft. If it works in Japan, the pitch travels to other governments that worry about depending on one American provider.
Rakuten has been an AST investor since 2020, and Rakuten Mobile plans to start testing satellite-to-phone service with AST in a commercial setting this year. Neither company has given a satellite count or launch schedule for the Japanese network yet.
What to watch
The open questions are practical. How many satellites Japan needs for continuous coverage of its own territory, whether the network will carry government and defense traffic with priority access, and how the J-LEO funding is split between hardware and operations. AST’s ability to build and launch its large BlueBird satellites on schedule is the other risk. Its order book is growing faster than its launch cadence, and a sovereign customer will be less patient with delays than a carrier partner.