Summary:

It looks like another fumble for the Finnish handset maker. Nokia (NYSE: NOK) has reportedly cancelled a deal to launch its latest smartphon…

Nokia X7 AT&T

It looks like another fumble for the Finnish handset maker. Nokia (NYSE: NOK) has reportedly cancelled a deal to launch its latest smartphone, the X7, with AT&T (NYSE: T) in the U.S., over concerns about how much AT&T planned to subsidise and market the device.

The news was first reported by the Wall Street Journal, and we have contacted Nokia for confirmation.

If true, the cancellation is one more setback for Nokia in the U.S., where it has always struggled to gain traction with consumers but has had an especially poor showing with its smartphones in a market that has been dominated by RIM (NSDQ: RIMM) and Apple (NSDQ: AAPL) and, more recently, Android devices.

Nokia and AT&T were reportedly gearing up for a launch on February 13, one day before the Mobile World Congress show kicked off in Barcelona.

Instead, the WSJ cites a source who said that Nokia was not happy with the amount of subsidy and marketing that AT&T planned for the X7, which was going to be sold as the Nokia Journey, according to Pocket Now.

For the last couple of years, AT&T’s smartphone portfolio has been dominated by the iPhone, which it has sold exclusively, although that is due to end next month when Verizon begins to offer a CDMA version of the device. AT&T previewed several of its next-generation smartphones during CES but those all ran Android.

Selling the X7 with a subsidy and with AT&T’s marketing muscle behind it could have signalled a step change for Nokia. The company went it alone in the U.S. with the N8, its last major smartphone launch.

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