Japan's $2B J-LEO satellite network race narrows to three key bidders

Japan is moving forward with its plans for a domestically owned and operated satellite network called J-LEO. The government aims to reduce reliance on foreign-controlled systems by establishing a local alternative for low Earth orbit direct-to-device communications. A final decision on the winning operator is expected by the end of June. The Ministry of Internal Affairs and Communications has set aside around $1 billion in subsidies for the project. This funding will cover up to half the total cost, with the selected operator required to match the amount using private investment. The full project budget is estimated at approximately $2 billion.

Three main contenders are vying for the contract: Rakuten Mobile and AST SpaceMobile, the KDDI-SpaceX Consortium, and MDA Space. Rakuten Mobile and AST SpaceMobile propose using multiple AST satellites and the 700 MHz band, which Rakuten exclusively holds among Japan’s mobile network operators. MDA Space, recently chosen to build next-generation satellites for Japan’s Ministry of Defense, remains a potential wildcard in the selection process.

The chosen operator must meet strict requirements. These include a nationwide rollout by March 2029 and full domestic control of the network and data systems. The network must also support video calls on standard smartphones for at least 70% of the day and allow free roaming across carriers during emergencies. The J-LEO project marks a significant step for Japan in securing independent satellite communications. Once operational, it will provide a resilient domestic alternative for direct-to-device services. The government’s subsidy and the operator’s private funding will together finance the $2 billion initiative.