Japanese Public, Private Sectors to Partner on ¥3 Tril. Project to Develop Domestic AI, SoftBank to Be Key Firm Involved

The Yomiuri Shimbun

21:00 JST, December 21, 2025

Aiming to develop Japan’s largest foundation model for artificial intelligence, a new company will be established as early as next spring by more than 10 Japanese companies, including SoftBank Corp., according to the details of a domestic AI development project totaling ¥3 trillion.

Because the United States and China are leading the world in the development of AI, the Japanese public and private sectors will jointly work on the project to regain last ground.

SoftBank and others are considering responding to a public offering to be placed by the Economy, Trade and Industry Ministry. The ministry will provide about ¥1 trillion for the new company over a five year period starting in fiscal 2026.

The ministry plans to include over ¥300 billion for related expenses in the budget for fiscal 2026.

SoftBank plans to invest ¥2 trillion in data centers to be used for the development and provision of AI over six years starting in fiscal 2026.

Softbank will play a central role in establishing the new company, which is expected to have about 100 employees, mainly AI engineers from Softbank and AI development company Preferred Networks, Inc.

The new company will first aim to develop a foundation model with 1 trillion parameters, a size that has been achieved or exceeded by the world’s leading AIs. The envisaged model will be made available to Japanese companies so they can use it for their own purposes. The ultimate aim of the project is to develop an AI that can be used in robots and is expected to become mainstream in the future.

The new company will procure a large amount of high performance semiconductors from U.S. semiconductor giant Nvidia and develop a large scale computer platform to be used in AI learning.

Since this project will require a massive amount of money, the ministry will offer financial assistance to cover part of the development and other costs. The government will also provide subsidies for the collection and purchase of data used for AI learning.

To develop an AI that consume less electricity than overseas AIs, the government will also consider using “GX economic transition bonds” to finance the project.

SoftBank believes that the development of domestic AI will spur demand for AI in Japan, such as the development of new products and services, and that the project will allow the company to get usage fees that will compensate for the massive investment.

Currently, data centers are being built in Tomakomai, Hokkaido, and Sakai, and they are scheduled to begin operations by fiscal 2026.

These two data centers are likely to be used for the development and provision of domestic AI. Investments will be made in a phased manner according to corporate demand for AI.

AI is directly related to industrial competitiveness and national security, and it has become a technology th at influences national power. The ministry believes that relying solely on foreign AI poses industrial risks.