Cisco Systems Inc. (Nasdaq: CSCO) has confirmed reports of a hefty Canadian layoff. And it appears that it also may discontinue work on a planned six-building campus for optical product development in Kanata, Ontario.

Yesterday, the Ottawa Citizen newspaper reported that Cisco has laid off roughly 80 percent of the 220 employees of PixStream, a video networking company located in Waterloo, Ontario, which Cisco purchased for about US$369 million in August 2000.

The paper also reported that Cisco laid off about 14 percent of its workers in its Kanata facility -- 41 of 435 full-time employees, a population that had doubled since February 2000.

Cisco confirms the paper's figures. In total, Cisco's laid off about 28 percent of its 1,080-person workforce in Canada as part of its overall restructuring plan, which calls for 8,500 cuts this year from its 44,000-employee roster.

Cisco also appears to be stalling completion of a six-building Ottawa Development Center in Kanata. When originally announced by Cisco in February 2000, this project was designed to cover about 600,000 square feet and house about 2,400 employees. So far, one building is completed. Two other buildings are under construction, Cisco says.

Online records for the Ottawa Construction Association show Cisco has not taken out any building permits since December 2000, when it took out three worth about about $9.3 million in total. Of several leading construction contractors and unions contacted by Light Reading in the Ottawa area, none is presently at work on the project.

Cisco denies any stoppage in plans. "I am aware of no change to the plan to move forward with this project," says Cisco spokesperson Willa Black. But she allows there may be future changes "in line with economic realities."

In Richardson, Texas, Cisco has apparently halted work on a campus planned for 6,000 employees (see Cisco Circles the Wagons in Texas). It is also rumored to have recently cancelled its plans for an office expansion in New York City.

- Mary Jander, Senior Editor, Light Reading http://www.lightreading.com