The article says that it has 8mb of cache per core, shared by four hardware threads.
http://www.channelregister.co.uk/2010/06/01/intel_knights_co...
Well, maybe. There are diminishing returns on increasing cache sizes (you solve the capacity misses but don't really deal with compulsory and conflict misses)...though it would be impressive an impressive feat of process technology. The closest to that amount at the moment I believe is IBM's Power 7, which has a 30MB on-die L3 implemented in eDRAM.