Microsoft offers no new cost cuts, shares plunge

Speaking at an analyst meeting in New York today, Microsoft CEO Steve Ballmer did not offer any new cost cutting measures beyond the company's plans to lay off 5000 employees. Said Ballmer, "I don't think it makes sense for us to come back and say, 'Could we take out another $2 billion in costs?'" Instead, Ballmer stated that the company plans to increase revenues by pushing Windows 7 for netbooks (low cost, low spec laptops). The lack of new cost cutting measures resulted in Microsoft shares falling to an 11-year low, according to Reuters.

By offering a low-end version of Windows 7 for netbooks, Microsoft hopes that many users will opt to upgrade to a more powerful version of the operating system. The catch is that Microsoft plans to 'encourage' users to upgrade by limiting the functionality of the stripped down version. One example of this given by Ballmer: Restricting the number of programs that can be opened simultaneously.

How many programs? We don't know, but we imagine plenty of people will be mighty pissed when that damned paperclip pops up and asks them to upgrade.

Update: Reader Duke points out that our buddies at Engadget posted a breakdown of Windows 7 versions earlier this month. The basic version, Windows 7 Starter, will allow only three applications to run concurrently.

This article was originally published on Joystiq.