Apple restructure pares to the core

Products and divisions will be shed as the troubled vendor attempts to cut its way out of difficulty

Apple is expected to announce a major restructure next week that will leave up to 3,000 workers without jobs and see the return of co-founder Steve Jobs to the executive council.

The changes are expected to be announced at the annual shareholders? meeting next week. They form part of CEO Gil Amelio?s drive to cut expenses by 20 to 25 per cent.

According to industry sources, the current company structure of six product groups is expected to be trimmed to three core sectors, structured around publishing, education and either the internet or consumer.

Centralised organisations will be created to manage engineering, marketing and operations and finance. The functions are currently devolved to each product group.

Amelio hinted that the company may ditch the unprofitable Newton line, saying: ?Maybe we missed the boat?. He confirmed Apple was going to drop the Pippin internet device.

The troubled company?s latest quarter sales figures were weaker than expected. Mac shipments were down 923,000 ? a drop of 29 per cent from the year before.

Apple cut prices on Power Macs and Performas by up to 27 per cent last week.

US Apple watcher Tim Bajarin told the San Jose Mercury News that the price cuts were an ?act of desperation? to clear old stock for the release of the new Next-flavoured operating system.

Microsoft CEO Bill Gates is reported to have been in discussion with Amelio and Jobs with a view to licensing Windows NT for the Mac. Plans are rumoured to be afoot to release a separate line of machines running Intel processors.

Apple declined to comment.