Already, one of their internal studios, ACES, is confirmed shut down. The studio was responsible for the Flight Simulator series. Dean Takahashi from Venture Beat has also learned that 30 percent of the company's video game testers have been laid off. It appears this may be just the beginning of a larger shakedown for the Xbox and PC gaming parts of Microsoft. Takahashi also notes that "the game group is expected to undergo a management restructuring" next week.
Microsoft has yet to release an official comment. Stay tuned as we'll keep a close eye on this situation.