Neil Thompson, head of Xbox for Northern and Eastern Europe, has revealed that a portable Xbox console is not in development.

Speaking to the technology website T3, Thompson ruled out a move by Microsoft to enter the portable gaming arena with their own console to rival the PSP and DS.

"We're not even thinking about that at the moment. Handhelds, in the way you would think about a handheld like a PSP? No." said Thompson. "The mobile phone market offers us a really good opportunity to capitalise on the hundreds of millions of handsets that are out there, and give people a chance to connect that with other entertainment experiences."

Microsoft revealed its plans for mobile phones during its pre-E3 conference, when Bill Gates announced his company's Live Anywhere service. The service expands on the existing Xbox Live service, allowing PC, Mobile Phone and Xbox 360 users to play together.

Thompson's dismissal of the company's development of a handheld games console goes against claims made by author Dean Takahashi in his latest book, The Xbox 360 Uncloaked. In the book Takahashi claims that half of the Xbox 360 hardware team is already hard at work on a new console that would be released mid-way through the lifespan of the Xbox 360.