The Associated Press

REDMOND, Wash — Microsoft (Nasdaq: MSFT) said Tuesday that the president and another key executive from the group that makes its Xbox 360 game system, Windows mobile phones and Zune media players are leaving.

(Microsoft’s gaming unit is the publisher for Cary, N.C.-based Epic Games’ mega-selling “Gears of War” videogame.)

The news comes at a critical time for the division. Microsoft Corp.’s phone software and Zune both lag competitors. Microsoft just overhauled its mobile phone system and started selling phones for younger users.

And the company is betting on an upcoming video game system that understands body movements to rev up sale.

Robbie Bach, who has led the division, is stepping down this fall after 22 years with the software maker.

J Allard, who has managed the technical development of the Xbox and the Zune, is also leaving but will continue to advise Microsoft Chief Executive Officer Steve Ballmer.

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