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Activision to Lay Off 150

The video-game publisher will give pink slips to roughly 7% of its employees.

Updated from 6:35 p.m. EST

Activision

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, amid struggles with a rocky transition to new video-game technology, said Monday that it is laying off about 150 workers, or less than 7% of its staff.

The company began notifying workers last week, company spokesman Ashley Dyer said. Instead of being targeted at a particular office or group of workers, the layoffs were "across the board," Dyer said.

However, the job cuts, first reported in

The Wall Street Journal

, will affect some the company's game development employees, he said.

Dyer did not specify the number of workers that Activision is laying off, but said it is less than 7% of the company's total workforce of 2,200. The cutbacks are part of an effort to "realign" the company's operations for the next two years, Dyer said.

"We're just trying strike a balance between our near-term needs in '07 and our anticipated growth in '08," he said.

In an

earnings announcement last week, Activision officials predicted that the company's sales would decline in the coming 2007 fiscal year for the first time in more than a dozen years.

Although company officials anticipate a rebound in sales the following fiscal year, they forecast revenue for fiscal 2008 significantly below what Street analysts were expecting.

Activision will pay severance to laid off workers at "industry standard" rates, said company spokeswoman Maryanne Lataif. But Lataif declined to say what the total cost will be to the company.

The layoffs at Activision come after

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similar cuts at rival video-game publisher

Electronic Arts

(ERTS)

, which said earlier this month that it was eliminating more than 200 positions, or less than 5% of its workforce.

Like EA, Activision plans to "redeploy" at least some affected workers to new positions, Lataif said.

Both companies and the wider video-game industry have been trying to cope with the effects of the move to a new generation of video-game hardware.

Microsoft

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released its new Xbox 360 game console last fall, inaugurating a transition to new machines and software.

Although past transitions have been marked by declining industry sales and rising development costs, some in the industry had hoped that the changeover would go more smoothly this time.

Instead, industry sales

plunged this past holiday season, and the transition is beginning to seem like it will be

as bad as -- if not worse than -- past changeovers.

Shares of Activision closed the regular session up 12 cents to $13.07.

As originally published, this story contained an error. Please see

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