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If Nokia (News - Alert) did not already have enough challenges in the New Year, the company has decided to cancel the U.S. release of its smartphone model, according to a report from the Wall Street Journal.

The X7 smartphone was supposed to be released in the United States just with AT&T, Inc., the Journal reported. Citing unnamed sources, the Journal said Nokia canceled the U.S. release of the X7 because AT&T did not give them enough “marketing and subsidies support.” Nokia will likely release the X7 in markets outside of the United States.

Nokia was expected to introduce the X7 sometime before the Mobile World Congress (News - Alert) trade show, which is taking place in February in Barcelona, Spain, the Journal said.  

In the U.S. market, Nokia ranks below Apple, Research in Motion (News - Alert), and various phones running on Android software from Google. To make matters worse, rivals of Nokia are moving forward with new products for the U.S. market.

At the recent Consumer Electronics Show in Las Vegas, Motorola Mobility Holdings, Samsung Electronics, and HTC (News - Alert) introduced their smartphone models that will be released soon in the United States. In another major industry trend, Verizon Wireless will start to sell the iPhone (News - Alert) 4 next month, according to TMCnet.

Nokia has relied on the Symbian operating system, which also is used in the X7. The Journal said industry observers see the Symbian OS as out of date.

The expected change by Nokia to the MeeGo platform has faced delays, The Journal added.

TMCnet explains that Nokia has been particularly trying to compete against Apple and Samsung in the fierce smartphone business.

But the way the market share has been divided among the producers of high-end smartphones, as well as the division among producers of lower-end phones, has created a likely negative impact on Nokia’s bottom line, according to a recent report from Reuters.

Nokia is expecting to report a 24 percent drop in earnings per share for the fourth quarter, Reuters said.

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