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Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times reporter Sharon Chan.

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January 22, 2009 9:23 AM

Speculation now turns to where, specifically, Microsoft will cut

Posted by Benjamin J. Romano

As Microsoft employees are digesting news of the first company-wide layoff, speculation is centering now on where, specifically, the cuts will fall.

Satya Nadella, has sent an e-mail to his organization saying there will be cuts in the Online Services Business, a source tells me.

On the Mini-Microsoft blog, the company's unofficial virtual union hall, anonymous comments are streaming in with details -- to be taken with a grain of salt -- on what groups have been notified of major cuts, and what groups have been told they're in the clear.

Mary Jo Foley reports that her sources are saying "the Entertainment and Devices (E&D) unit -- the group that is responsible for Xbox, Zune and Windows Mobile -- is being hit with the bulk of the immediate 1,400-person cuts."

A spokeswoman told me this morning that the majority of the 1,400 cuts today will be in Redmond.

More coverage of Microsoft's cost-cutting

Microsoft laying off 1,400 today, up to 5,000 in next 18 months

Ballmer's e-mail to employees
Majority of cuts to be in Redmond; total reduction is roughly 3 percent
Contractor spending could be cut up to 15 percent
Gregoire calls layoffs "disheartening"

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