Apple's jilted iPod partner PortalPlayer has been forced to axe 45 employees (14 per cent of its staff), in an attempt to rally itself following the loss of some of Apple's business.

The move follows Apple's decision not to use the next version of the company's multimedia chip in a range of updated iPods that are expected to debut later this year.

Apple's decision was a severe calamity for the smaller company, as 95 per cent of its existing business comes from Apple.

PortalPlayer expects these redundancies to cost it up to $950,000 in its current quarter, according to The Street. However, the move will save it up to $7 million in expenses.