Bulk of Microsoft Layoffs Hitting Xbox, Zune Divison?

By Chris Faylor, Jan 23, 2009 8:17am PST

Update: Over at VentureBeat, respected games journalist Dean Takahashi has confirmed the closure of Flight Simulator developer ACES.

He also offers word that Microsoft has laid off roughly 30% of its game testers, and may restructure the management of its gaming division next week.

Original: A majority of the immediate 1,400 layoffs Microsoft announced yesterday will hit its Entertainment & Devices division, anonymous sources have told ZDNet.

That's the branch responsible for Microsoft's gaming efforts, including the Xbox 360 console and PC titles, along with its portable Zune media player. The actual effects that the layoffs will have on its products and their future support is not yet known.

The studio responsible for Microsoft's Flight Simulator games is reported to be among those cut, losing a bulk of, if not its entire, staff. There's no indication from Microsoft if this signals the end of the Flight Simulator series, or if it will be tasked to another studio.

The layoffs also hit those responsible for Microsoft's Xbox-oriented Gamerscore Blog, which shut down earlier this week. Former writers Chris Paladino and Nelson Rodriguez revealed the news via their respective Twitter pages.

In all, Microsoft plans to eliminate "up to" 5,000 jobs across the next year and a half, with the cuts said to be coming from R&D, marketing, sales, finance, legal, HR, and IT.

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