Cray buys Vancouver supercomputing firm for US$115M

Supercomputer company Cray Inc. said it will buy a relative newcomer to the high performance market, Vancouver’s OctigaBay Systems Corp.

The deal, announced Wednesday

and worth an estimated US$115 million, will allow Cray to extend its market beyond traditional boundaries, according to spokesperson Steve Conway.

Cray’s flagship product, the X1, sells in the US$3-million and up price range. OctigaBay’s 12K, set to ship this summer, is closer to the US$100,000 mark.

OctigaBay was founded two years ago. Its 12K product uses AMD Opteron 64-bit processors in parallel and a Linux operating system to run complex applications for industries like aerospace, automotive and life sciences.

The difference between Cray and OctigaBay is that “”we really approach the problem from quite a different angle,”” said OctigaBay vice-president of marketing Adam Lorant. “”We have built an architecture that is purpose-built and optimized for these sorts of applications using the economics of commercially available components.””

OctigaBay first drew the attention of Seattle-based Cray at the November 2003 SuperComputing Conference in Phoenix, when the company first demonstrated 12K.

“”The rationale (for the acqusition) is that Cray has been selling into the very high-end of the supercomputer market and has wanted to expand beyond that, but only in the right way,”” said Conway.

Cray was already working on its own Operton-based supercomputer called Red Storm — a 40 TeraOp (40 trillion calculations per second) product that was originally developed for the U.S. Department of Energy and was being commercialized.

Red Storm sells at the US$1-million and up mark. The introduction of the product opened avenues previously unavailable to Cray, but the OctigaBay acquistion will create different opportunities, said Conway.

“”The design philosophy, the principles by which both companies design supercomputers were very, very similar but OctigaBay was designing them primarily for parts of the market that Cray was not addressing,”” he said.

OctigaBay will become a division within Cray and will maintain its Vancouver office and staff of 66. There are no plans to change staffing levels, said Conway, and OctigaBay will take advantage of Cray’s existing sales and marketing structure.

“”OctigaBay will have a good amount of autonomy and that’s what’s needed because they’re operating on a bit of a different model and aiming at a different part of the market,”” said Conway.

Cray has no other plans for expansion currently and will remain a supercomputing firm. To move into other markets would begin to put it in competition with other companies like IBM and Hewlett-Packard, said Conway.

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