Microsoft confirmed today that it plans to discontinue its Popfly online programming tool, which let people create online games, web sites and mashups of Internet services. A note on the Popfly site says the service will be discontinued Aug. 24. A related blog post doesn't explain a reason for the decision, but Microsoft says budget cutbacks played a role.

Here's the statement the company issued in reponse to our inquiry.

With Popfly, Microsoft set out to do something new, and made some really great progress and learned a lot of lessons that we will apply to our (software plus services) offerings and developer tools such as how to operate a large scale service, how beginner developers approach their first projects, and how to cultivate innovative ideas and bring them through the product life cycle. However, like many companies, the economic situation has caused us refocus and to reevaluate our priorities; while successful and popular, Popfly is not part of our refocused strategy.

For hobbyist developers interested in refining their skills we have a number of helpful resources. For Web applications, please visit Microsoft Web Platform Installer. For those interested in programming on the Xbox, please visit Microsoft XNA. And for those who are interested in Windows programming, please visit Microsoft Express.

The company says all resources, games and mashups on the site will be taken down when it's discontinued next month. It's the latest in a series of online services and consumer products to be cut by the company in recent months.

(Via Mary Jo Foley's All About Microsoft.)