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Business trends

Japan's space industry gets some new life

Young venture companies promise new ideas and lower costs

Astroscale CEO Mitsunobu Okada, right, takes part in a press conference in March 2016.

SAPPORO/TOKYO -- Japan's space industry is set to take off in 2017, thanks to a growing number of private enterprises moving toward the launch pad.

The state-run Japan Aerospace Exploration Agency, or JAXA, as well as heavy machinery makers Mitsubishi Heavy Industries and IHI have so far been key engines of Japan's aerospace industry.

Now other companies aspire to break in.

In November 2016, Japan's parliament enacted two important bills, making it easier for private companies to go to space. One of them, the space activity law, specifically allows companies to launch artificial satellites if they meet certain criteria.

Among the new market entrants are Interstellar Technologies, Astroscale, PD Aerospace and Canon Electronics.

Small rockets, low prices

Canon Electronics, a subsidiary of Canon, suffered a setback on Sunday when the launch of a "mini rocket" ended in failure. Designed to be the world's smallest satellite launcher, the rocket stopped sending data back to mission control shortly after launch, and the mission was aborted.

Interstellar Technologies, which is developing a small rocket itself, has its head office in Taiki, a town of about 6,000 on the Pacific coast of Hokkaido, Japan's northernmost main island.

There is a facility in Taiki that is capable of launching a rocket. It was once used by the Defense Ministry but was taken over by the municipal government. Interstellar Technologies got permission to conduct experiments there.

Interstellar Technologies CEO Takahiro Inagawa stands in front of the company's experimental small rocket.

Interstellar Technologies was founded by Takafumi Horie, former president of Livedoor, the early 2000s Japanese internet sensation.

Interstellar Technologies' rocket-development efforts shifted into high gear in 2013, when Takahiro Inagawa became CEO.

The venture is now preparing to test-launch a small rocket designed to reach an altitude of 100km as early as this spring.

JAXA also has its sights set on small rockets. In December, it launched the small Epsilon-2 rocket at a cost of 5 billion yen ($43.8 million).

Parts from Amazon

Interstellar Technologies is trying to reduce the launch cost of its rocket to less than 50 million yen. "We will increase the frequency of launches and lower the cost through mass production," Inagawa said.

At U.S. venture SpaceX, it costs around 6 billion yen to launch one large rocket. This is considered a low price. Launching a conventional large rocket is said to cost more than 10 billion yen.

Prices for rockets and satellites will start collapsing in Japan as well. Venture companies will lead the way.

Astroscale, a Singapore-based company, has its research and development center in Tokyo's Sumida Ward, close to Tokyo Skytree, a broadcast tower and landmark.

Astroscale is developing a small satellite designed to remove space debris. Its two-story research and development center looks like a warehouse. More than 10 employees have a number of tasks, like repeatedly testing parts for endurance using vacuum equipment.

The venture is aggressively adopting general-purpose electronic parts to cut costs. It even purchases some of them through online shopping sites such as Amazon.

The cost of space travel is also showing signs of collapsing.

Tour of space

PD Aerospace, a company based in Nagoya, Aichi Prefecture, is developing a next-generation spacecraft equipped with a propulsion system that can alternate between jet and rocket engine functions.

The craft, if realized, would use the jet engine function to take off from an airport, then switch to its rocket engine to head to outer space.

PD Aerospace is aiming to start operating the craft for commercial purposes in 2023. The company hopes to be able charge no more than 14 million yen per passenger.

PD Aerospace needs 17 billion yen to develop the spaceship. ANA Holdings and travel agency H.I.S. have invested tens of millions of yen in the venture.

If it can commercialize the spacecraft, PD Aerospace hopes to attract 1,000 passengers a year, or 10% of the expected global space tourism market.

Virgin Group is also developing a spaceship for tourists. Virgin's craft would be released from a mother ship, take tourists to space, then return to Earth by gliding to an airport.

PD Aerospace believes its craft would be safer than Virgin's vehicle because it would be able to use its jet engine to aid its return to the planet.

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