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Performance and power consumption of an on-chip interconnect that forms the backbone of chip multiprocessors (CMPs), are directly influenced by the underlying network topology. Both these parameters can also be optimized by application induced communication locality since applications mapped on a large CMP system will benefit from clustered communication, where data is placed in cache banks closer to the cores accessing it. Thus, in this paper, we design a hierarchical network topology that takes advantage of such communication locality. The two-tier hierarchical topology consists of local networks that are connected via a global network. The local network is a simple, high-bandwidth, low-power shared bus fabric, and the global network is a low-radix mesh. The key insight that enables the hybrid topology is that most communication in CMP applications can be limited to the local network, and thus, using a fast, low-power bus to handle local communication will improve both packet latency and power-efficiency. The proposed hierarchical topology provides up to 63% reduction in energy-delay-product over mesh, 47% over flattened butterfly, and 33% with respect to concentrated mesh across network sizes with uniform and non-uniform synthetic traffic. For real parallel workloads, the hybrid topology provides up to 14% improvement in system performance (IPC) and in terms of energy-delay-product, improvements of 70%, 22%, 30% over the mesh, flattened butterfly, and concentrated mesh, respectively, for a 32-way CMP. Although the hybrid topology scales in a power- and bandwidth-efficient manner with network size, while keeping the average packet latency low in comparison to high radix topologies, it has lower throughput due to high concentration. To improve the throughput of the hybrid topology, we propose a novel router micro-architecture, called XShare, which exploits data value locality and bimodal traffic characteristics of CMP applications to transfer multiple small flits o- - ver a single channel. This helps in enhancing the network throughput by 35%, providing a latency reduction of 14% with synthetic traffic, and improving IPC on an average 4% with application workloads.