On 2025-12-18, Rakuten AI 3.0, a 700B parameter MoE model, achieves a 90% cost reduction, advancing Japan’s AI sovereignty and signaling a shift toward efficient, culturally attuned models. How will this strengthen Japan’s AI ecosystem and competitiveness globally? This innovation matters now as it enhances technological sustainability and enterprise AI adoption amid global tensions.

Rakuten AI 3.0: A Technological Milestone

On December 18, 2025, Rakuten Group unveiled Rakuten AI 3.0, marking a significant milestone in Japan’s AI landscape. This advanced large language model (LLM) boasts approximately 700 billion parameters, making it the largest and most sophisticated AI model in Japan. Developed under the auspices of METI’s GENIAC project, Rakuten AI 3.0 is optimized for the Japanese language and cultural nuances. It employs a Mixture-of-Experts (MoE) architecture, activating around 40 billion parameters per token, which ensures high efficiency and performance. The model has demonstrated its prowess by topping Japanese benchmarks and achieving up to 90% cost reductions compared to third-party models used within Rakuten’s services. This development is a testament to Rakuten’s commitment to balancing performance with efficiency, leveraging its extensive bilingual data for training.

The Strategic Importance of Rakuten AI 3.0

Rakuten AI 3.0 is more than just a technological advancement; it represents a strategic move towards enhancing Japan’s AI sovereignty. By developing a model that is both efficient and culturally attuned, Rakuten reduces Japan’s reliance on foreign LLMs, a crucial step amid global AI tensions, particularly between the U.S. and China. This launch signals a broader shift towards specialized, cost-effective models inspired by open-source principles, which are increasingly favored for enterprise adoption in sectors like e-commerce and services. The implications are significant: Japan’s domestic AI ecosystem is strengthened, enhancing its competitiveness in global markets. Moreover, the model’s MoE efficiency allows for scalable deployment even in resource-constrained environments, underscoring the importance of government-private partnerships in accelerating national AI innovation. As Watanabe Takuya from METI noted, the successful development of such models is pivotal for expanding AI ecosystems and leading Japan’s AI industry.

Future Prospects for Rakuten AI 3.0

Looking ahead, Rakuten AI 3.0 is poised to play a pivotal role in shaping the future of AI in Japan and beyond. The model’s selection for the third term of the GENIAC project in July 2025, with government support for compute resources, highlights its strategic importance. As it continues to outperform previous iterations, such as Rakuten AI 2.0, the model is expected to drive further innovation in AI applications across various industries. The efficiency and cost-effectiveness of Rakuten AI 3.0 make it an attractive option for enterprises looking to optimize their AI deployments without incurring prohibitive costs. This development also sets a precedent for other nations aiming to bolster their AI capabilities through similar government-private collaborations. As AI continues to influence consumer behavior and enterprise operations globally, Rakuten AI 3.0 stands as a beacon of innovation, optimism, and sustainability.

Editorial Reflection

Rakuten AI 3.0 marks a significant advancement in Japan’s AI capabilities, offering a high-performance, cost-effective solution that enhances national AI sovereignty. Its development underlines the importance of efficient, culturally attuned models in a globally competitive landscape.

This launch reflects a broader trend towards specialized AI models that prioritize efficiency and cultural relevance. It highlights the potential of government-private partnerships in driving innovation and positions Japan as a leader in AI development amid international tensions.

For readers, this development underscores the growing importance of AI in everyday life and industry. It suggests a future where AI models are not only powerful but also tailored to specific cultural and economic contexts, influencing global AI strategies.

This story sheds light on broader implications in Technology & Innovation, encouraging readers to reflect on its impact.

Stay updated with the latest in AI innovation.

Sources

https://global.rakuten.com/corp/news/press/2025/1218_01.html