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Originally published February 1, 2012 at 6:43 PM | Page modified February 2, 2012 at 7:52 AM

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Microsoft lays off 200 workers; most of them in Seattle area

Microsoft laid off workers — the majority in the Seattle area — as part of a restructuring of its marketing operations.

Seattle Times technology reporter

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Microsoft laid off about 200 employees Wednesday as part of a restructuring of its marketing operations.

Sources close to the company said that the layoffs — the majority of them in the Seattle area — are aimed at reducing duplication of job responsibilities, clarifying the roles and responsibilities of the company's central marketing team vs. divisional product-marketing groups, and improving the impact of the company's marketing as a whole.

The reorganization gives greater control over advertising to the product-marketing groups within each of Microsoft's business divisions, such as the ones for Bing within the Online Services division or Xbox within the Entertainment & Devices division.

Microsoft's central marketing team will continue to oversee the company's brands and coordinate efforts in the divisions.

The restructuring also reduces the number of marketing job titles from more than 60 to seven.

"Given the rapid changes in technology and the shifts in how our customers connect with Microsoft, great marketing is more important than ever to Microsoft's future success," the company said in a statement. "We're taking steps to improve the effectiveness and efficiency of our marketing, and to strengthen career paths for marketers at Microsoft."

The 200 layoffs Wednesday were spread across various divisions — including Windows, Server & Tools and Online Services, as well as the central marketing team. The layoffs also cut across different marketing positions — including planning, product marketing, product management and business development — and levels, including administrators and general managers, according to one Microsoft marketing manager who was among those laid off.

The 200 constituted about 3 percent of the company's worldwide marketing force of 6,000.

Microsoft has about 92,000 employees worldwide, 40,600 of whom work in the Puget Sound area.

Organizational layoffs are rare at Microsoft. In 2009, Microsoft had its first companywide layoff, eventually cutting 5,800 jobs.

The restructuring comes some 10 months after Chris Capossela was appointed chief marketing officer. In those months, Capossela has been looking into ways to improve Microsoft's marketing operations to become more efficient and effective.

In addition to the restructuring, the changes also include establishing core principles for Microsoft's future marketing, such as understanding what differentiates Microsoft from its competitors such as Google and Apple, according to a source close to the company.

Microsoft spent $13.9 billion on sales and marketing in fiscal 2011, a 5.5 percent increase from the previous year. Bloomberg News reported earlier that CEO Steve Ballmer apparently didn't think the company was getting enough return on those marketing dollars.

Janet I. Tu: 206-464-2272 or jtu@seattletimes.com. On Twitter @janettu.

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