Rumor: Xbox division faces brunt of Microsoft's first round of layoffs

According to Mary-Jo Foley, Microsoft columnist for ZDNet, the majority of the company's recently announced 1,400 layoffs will be aimed at the Entertainment & Devices division, which is responsible for the Xbox, Zune and Windows Mobile. Given the recent closure of Gamerscore Blog and the following layoffs of some of its staff members, we're not inclined to argue. All of this, of course, comes hot on the heels of a recent report from Fudzilla, which claimed that upcoming layoffs were not likely to fall on Microsoft's profitable entertainment division.

Dean Takahashi reports for VentureBeat that ACES Studio, best known for the Flight Simulator franchise, has been shut down. Additionally, he reports that 30% of Microsoft's game testers have been cut and that the game group will soon undergo a "management restructuring."

Expect more on this story as it develops.

[Via GameDaily]