Did webscale computing force Intel’s Cray buy?

Intel (s intc) paid $140 million on Tuesday to buy the interconnect business of Cray, the original manufacturer of supercomputers. From here it looks like there’s little left of Cray moving forward, but the interesting bit about this deal isn’t what it means for Cray (and maybe supercomputing) but what it could mean for webscale and the next iteration of servers. Because this deal and AMD’s (s amd) buy of SeaMicro last month is all about the fabrics.

Chipmakers have been busily adding cores to their servers, but getting those cores to communicate without creating bottlenecks is a huge problem. And as the Web scales to reach billions of people, who are spending more time using online services, the infrastructure supporting those services is reaching a breaking point. Data centers that used to be the size of a corner gas station are now the size of a WalMart distribution center. Inside those centers are more servers containing many, many more CPU cores.

But at that scale communications between servers and between compute cores within servers are a problem. That’s why the IT industry is so excited about the software-defined networks (sometimes called fabrics) and OpenFlow protocols that will help make communications between servers scale. And inside servers, a similar level of virtualization and a focus on fabrics is gaining attention: What’s happening at the data-center scale is also happening inside the box.

For example, SeaMicro, the server maker that was recently acquired by AMD, built a 1.28 terabit compute fabric inside its server, which contains 256 cores. One SeaMicro box could replace 500 machines from five years ago and run at 96 percent of the power consumed by the old machines, according to a presentation the company made in January when it launched its most recent boxes. Another startup in the server space, Calxeda, which is building ARM-based servers with HP, is taking a similar approach, spending its R&D efforts on the fabric the handles communications between the many ARM chips inside its box.

Now that AMD has bought SeaMicro, which was using chips from Intel, the world’s largest chip company might be looking to make its own play in the webscale server market (as well as beef up its ability to connect a lot of cores for the high performance computing market that Cray serves). In the past Intel has said webscale will be only 10 percent of the total server market, but I think it’s wise to ensure it has a fabric technology of its own now that AMD has SeaMicro and Calxeda is in bed with ARM, Intel’s rival on a growing number of fronts.

Hence buying the engineers, IP and expertise of Cray, which pioneered interconnect technology that allows thousands of chips to communicate at high speeds. Chips are always going to be important inside servers, but now it’s time for fabrics to shine too. It’s a topic we’re going to be talking more about at our Structure 2012 event with SeaMicro’s former CEO Andrew Feldman and AMD’s Lisa Su.