Awaiting Microsoft's cuts

The guessing game continues as Redmond watchers try to predict which notches might get tightened in the software maker's rather massive belt.

The uncertainty surrounding Microsoft's cost-cutting plan is likely to last only another day, until the software maker announces earnings Thursday.

That's when many people expect the company will detail its plans, which will likely include the company's first-ever companywide layoffs.

In the absence of hard facts, the guessing game goes on. I was fond of Todd Bishop's post at TechFlash on "Five things we really wouldn't miss" if Microsoft cut them.

Zune hardware tops the list, which also includes Microsoft's little-known YouTube rival Soapbox, and its search business. Although it seems very unlikely the software maker would jettison the latter, Bishop argues it could do a different kind of partnership with Yahoo--propping up Yahoo's search business and using the money not spent on Microsoft's own R&D to improve Windows.

I suspect Microsoft will make some cuts, but probably not any of those things, with the possible exception of Soapbox. I'd echo former CNET colleague Joris Evers, who mentioned via Twitter that Windows Home Server may be a good candidate for the ax.

So far, the only big thing the company has abandoned is its Windows Live OneCare antivirus service. Even there, it is moving forward with "Morro," a new, free product for combating malicious code.

Microsoft is clearly trying to do what it can to minimize the number of full-time blue badges it has to let go. It has already slowed hiring , scaled back the number of vendors and contractors it uses, and is making moves to lessen its real estate costs.

That said, it's unlikely that Microsoft will be able to maneuver this economy without painful cuts. If you were CEO Steve Ballmer, where would you cut?

About the author

    During her years at CNET News, Ina Fried has changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley. These days, most of her attention is focused on Microsoft. E-mail Ina.

     

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