Zoho moves beyond software, launches its own servers to cut AI infrastructure costs
Zoho has launched Nathu La, its first in-house server platform, as it looks to reduce the rising costs of AI infrastructure and data centre operations. The announcement comes even as founder Sridhar Vembu continues to warn students against becoming overly dependent on AI tools.
Zoho has entered the hardware space with the launch of Nathu La, its first in-house server platform designed to power AI and cloud workloads. The Chennai-based company says the move will help reduce infrastructure costs, improve energy efficiency and give it greater control over the technology stack that supports its products. Developed by Zoho's engineering team in Nagpur in collaboration with Intel, Nathu La uses Intel Xeon 6 processors and will be deployed across the company's own data centres.
Zoho claims the platform delivers similar performance while reducing power consumption by 12-18 percent and lowering total ownership costs by 20-30 percent. The launch comes as technology companies face rising expenses tied to AI infrastructure and computing power.
"Hardware is one area where we have traditionally relied on global OEMs. But infrastructure has become foundational and if compute becomes foundational, we should own it," Ramprakash Ramamoorthy, Director of AI Research at Zoho Corp, told Money Control.
Zoho currently serves more than 150 million users globally and operates over 16 data centres. According to the company, increasing AI-related costs played a major role in the decision to build its own server platform.
"Infrastructure costs and inference costs are becoming one of the biggest line items for software companies," Ramamoorthy said. "The same server configuration that we purchased six months ago now costs three to four times more."
Unlike traditional server manufacturers, Zoho is not planning to sell Nathu La commercially. The company says the platform has been built primarily for internal use and is already being deployed across selected workloads.
"We launched a server platform primarily for internal use. We are dogfooding it as we speak. Zoho runs on Zoho," Ramamoorthy said.
Zoho currently has a few hundred Nathu La servers running within its infrastructure and expects deployments to reach around 2,000 by the end of the year.
Vembu urges students to stop relying on AI
The launch also arrives at a time when Zoho founder Sridhar Vembu has been speaking about the risks of excessive dependence on AI. Responding to reports of rising failure rates in computer science courses at UC Berkeley, Vembu recently warned that students should build strong fundamentals before relying heavily on AI tools for learning and problem-solving.
"AI can make you smarter faster but AI can also make you dumber faster," Vembu wrote on X.
He has argued that overuse of AI could weaken critical thinking skills among students. Citing a research, he recently asserted on X that "high school students don't learn mathematics better with AI, they just learn to rely too much on AI. AI is not a training wheel, it becomes a crutch." Vembu has also given some interesting advises on career options that will remain safe from AI. He has openly spoken about careers he believes will continue to hold value in an AI-driven world, including teaching, caregiving, farming, forest conservation, temple service and classical music.
Zoho has entered the hardware space with the launch of Nathu La, its first in-house server platform designed to power AI and cloud workloads. The Chennai-based company says the move will help reduce infrastructure costs, improve energy efficiency and give it greater control over the technology stack that supports its products. Developed by Zoho's engineering team in Nagpur in collaboration with Intel, Nathu La uses Intel Xeon 6 processors and will be deployed across the company's own data centres.
Zoho claims the platform delivers similar performance while reducing power consumption by 12-18 percent and lowering total ownership costs by 20-30 percent. The launch comes as technology companies face rising expenses tied to AI infrastructure and computing power.
"Hardware is one area where we have traditionally relied on global OEMs. But infrastructure has become foundational and if compute becomes foundational, we should own it," Ramprakash Ramamoorthy, Director of AI Research at Zoho Corp, told Money Control.
Zoho currently serves more than 150 million users globally and operates over 16 data centres. According to the company, increasing AI-related costs played a major role in the decision to build its own server platform.
"Infrastructure costs and inference costs are becoming one of the biggest line items for software companies," Ramamoorthy said. "The same server configuration that we purchased six months ago now costs three to four times more."
Unlike traditional server manufacturers, Zoho is not planning to sell Nathu La commercially. The company says the platform has been built primarily for internal use and is already being deployed across selected workloads.
"We launched a server platform primarily for internal use. We are dogfooding it as we speak. Zoho runs on Zoho," Ramamoorthy said.
Zoho currently has a few hundred Nathu La servers running within its infrastructure and expects deployments to reach around 2,000 by the end of the year.
Vembu urges students to stop relying on AI
The launch also arrives at a time when Zoho founder Sridhar Vembu has been speaking about the risks of excessive dependence on AI. Responding to reports of rising failure rates in computer science courses at UC Berkeley, Vembu recently warned that students should build strong fundamentals before relying heavily on AI tools for learning and problem-solving.
"AI can make you smarter faster but AI can also make you dumber faster," Vembu wrote on X.
He has argued that overuse of AI could weaken critical thinking skills among students. Citing a research, he recently asserted on X that "high school students don't learn mathematics better with AI, they just learn to rely too much on AI. AI is not a training wheel, it becomes a crutch." Vembu has also given some interesting advises on career options that will remain safe from AI. He has openly spoken about careers he believes will continue to hold value in an AI-driven world, including teaching, caregiving, farming, forest conservation, temple service and classical music.
