  Product diversity is one of the prominent factors for customers'
satisfaction, while from the firms' perspective, the additional engineering
costs required for product diversity should not exceed the acquired profits
from the increase in their market share. Thus, one of the critical
decision-making tasks for companies is the selection of an optimal mix of
products, namely product portfolio management (PPM). Traditional studies on PPM
problem have paid relatively less attention to the actions of other
competitors. In this paper, we study PPM problem in a competitive environment
where each firm's objective is to maximize its expected shared surplus. We
model the competition with an $n$-player game that optimal product portfolios
are driven from its Nash equilibrium. Utility functions are determined by the
expected value of the shared surplus. We analyze the strategic behavior of
firms to determine their optimal product portfolios.
