Microsoft is preparing to announce the first widescale layoffs in its 32-year history, with up to 15,000 jobs at risk, according to some predictions.

Speculation about job cuts was triggered by a report from Fudzilla, the technology blog site, which said that employees had been told that the software group was “readying major layoffs to its worldwide operations” on January 15.

That prompted a flurry of internet commentary, with estimates of planned redundancies varying from

10 to 17 per cent of the company's 91,000 employees worldwide. MSN, the online division, is expected to be heavily affected.

The news came as the company was forced to apologise for an embarrassing hiccup with its Zune digital music player. A bug in the device's internal clock in the original 30-gigabyte version failed to cope with the last day of the leap year and thousands of owners were left with a frozen screen on December 31.

Microsoft said in a statement that the problem would fix itself: “The issue should be resolved over the next 24 hours as the time change moves to January 1, 2009. We expect the internal clock on the Zune 30GB devices will automatically reset.”

Steve Ballmer, the company's chief executive, is to speak at the International Consumer Electronics Show in Las Vegas, which opens next week, where he is expected to release a new version of the Windows operating system.

Microsoft's second quarter results are due on January 22.

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