As it looks to grow its market share in 2008, Microsoft has pinpointed Europe as the key battleground, and identified Sony as its main rival.

Jeff Bell, head of global marketing for Microsoft's games business, told Reuters that he expects the platform holder to shift more Xbox 360 units in 2008 than in 2007, primarily in Europe, but also in Japan.

Bell said that the Xbox 360 was strong in Britain and increasing its market share in both France and Germany, but that the recent PlayStation 3 price cut had given Sony a boost in Europe.

"We will sell more consoles next year than this year," Bell said.

"Europe for us is still the swing," he added. "The biggest challenge is that Sony as a brand has had greater staying power than in other areas. Not just PlayStation 3, but Sony as a brand."

Bell also said that in Japan, the territory in which Microsoft has struggled most to establish the Xbox brand in the face of stiff competition from Sony and Nintendo, upcoming games from popular domestic designers should help increase hardware sales during 2008.

Finally, Bell noted that Microsoft was poised to benefit from a shortage of Wii units this holiday season.

News-Source: Next-Gen