Europe is passing Americas.

Total current generation Europe HW sales - 59.14M. That's Europe, not Others, which is at 69.45M

Americas is at 70.03M

So the gap between them is currently at 10.89M

This year, the sales difference is like this:

Europe: 18.67M

Americas: 16.3M

I would expect the gap to increase by 1.5 times the amount for the rest of the year. Christmas should boost it a bit, but also remember that we don't have a full half left. 

The gap should thus be at ~ 4M, and that could be closed in the first Q of 09, as that is usually a very slow time in Americas, but not quite as slow in Europe.

Others should pass Americas within end of Q3 08.

Software wise, I say that Europe is Others minus 13%.

So there the situation is currently

Europe: 143M (a bit lacking data, truth might be ~ 175M)

Americas: 400M

So software wise, the situation isn't going to turn around quickly.

This is not true. Europe will never overtake the American video game market.

In terms of market value there was a report revealing the EU to be a bigger games market already in terms of total value compared to the United States (source: Nielsen). Of course the EU does not include many European countries, but does include the most wealthy ones except for smaller ones like Switzerland, Norway and Iceland.

 Gotta love these statements. Someone posts reasonable his thoughts, gives examples, makes predictions and the next post looks like this.

Europe is a very strong market for American and japanese developers to place their products on. The Euro is like $1.5.

I just don't get why all three companies treat the European market like they do.

Nintendo with their release dates. (more than a 6 months gap between jap / europe for Smash Brothers)

Sony released the PS3 4 months later and with a very limited amount.

MS limited marketplace with only 120 movies in Germany. (Don' know about uk though). The service is only offered in UK, Germany and France.

I believe it, with as many casual games appear on the UK top 10 list every week.

This is true. Europe will overtake the American video game market soon

Well I think the main reason is HD,tho Wii ownz at Europe.

This has been a long time coming. Europe has a massive population and a high standard of living. Its not surprising at all that it'll become bigger then the American market. That hardware sales have been faster for a while now, the software sales aren't there yet though.

@DirtyP: SSBB was a bad example because it was stretegically released (in every region) at a time when there were nothing big coming for PS360, to get that audience jump to Wii. So the release schedule is easy to understand.

Anyway, you still have a point there. But the main reason for all the delays is "tricky" european market, with a large number of different languages, different cultures, different importers and different taxing. The required amount of work is so big for the european release, but admittedly, EU have helped a lot in this case.
There are some exceptions, like SMG, MKWii and Wii Fit (although it took really long for Wii Fit to get released here after its initial release).

 Europe doesn't have an all that huge population compared to Americas.

South America can be subtracted, as it's fairly insignifficant.

But, in reality, you can subtract all the members of the previous Soviet Union. They are the main ones in "Other Europe" and they stand for ~ 6M so far. That's 10% of the total. They have a 300-350M population.

Subtract that, and you see that Europe is really somewhere around 375M vs 350M Americas. Their video game possible populations are almost even.