This paper describes a new interconnect and local area network transmission concept for computer communications based on spectrally encoding one or more computer words into a wavelength datagram. At physical and data link level, this system resembles an optical ribbon cable, except that all the bits pass on one fiber optic waveguide. At the network level, such fiber optic link segments can be interconnected all-optically using 2x2 optical switches into ShuffleNet or other architectures that permit a photonic packet to pass from source to destination without being incumbered with the extra delay and bandlimiting associated with electronic switching and regeneration. Unique properties of such a system include low latency (<10ns), very high bandwidth (<100Gbit/s per port), precise time alignment (<10ps) of the individual word bits over km distances, and dynamic scalability to support cluster computing and distributed supercomputing. Novel system elements disclosed in this paper include: (J) a bit parallel wavelength (BPW) fiber optic link that uniquely maintains wavelength channel time alignment, (2) an innovative parallel stepped wavelength optical transmitter that time synchronizes each laser diode element at its optical output, (3) a spectral encoder/decoder that adds fault tolerance and optical message addressing capability, and (4) a technique for transmitting and maintaining time aligned multi-X solitons as parallel bits through fiber media. Applications to teraflop high performance parallel computing and DoD input/output (I/O) bound applications are described.