Found this on the CNBC website ... far more promising news than what's been coming out of the rumour mill so far!

Microsoft will embark on a significant cost-cutting initiative in 2009, which might begin as early as this month, to offset a global slowdown in sales.
However, sources tell me the cuts will largely be handled through attrition and the non-renewal of contract employees, rather than through a rumored, sweeping layoff.

Now that's much more like it!