Struggling cellphone maker Nokia(NOK1V.HE) on Wednesday disclosed a software bug in its new flagship Lumia 900 model, dealing a setback to its ambitions to re-enter the U.S. smartphone market.
Nokia lost smartphone market dominance to Apple (AAPL.O) and Google (GOOG.O) in part due to its weak performance in the United States and the Lumia 900, which uses Microsoft's (MSFT.O) Windows Phone software, is a key component in its comeback bid.
"It's like they stalled their engine when everybody is looking at them at the start of their race," said Gartner analyst Carolina Milanesi.
The model went on sale in the United States through AT&T (T.N) on April 8 and is due to launch globally this quarter.
"A memory management issue was discovered that could, in some cases, lead to loss of data connectivity," Nokia smartphone unit chief Jo Harlow and Nokia U.S. chief Chris Weber said in a joint statement.
"This issue is purely in the phone software, and is not related to either phone hardware or the network itself," they said. A solution would be available around April 16.
Nokia said it will offer anyone who has bought Lumia 900, or will buy by April 21, a $100 credit to their AT&T bill. The operator sells the phone for $99.99 with a two year contract.
"They really did not need it particularly in this market, but I like the way they are dealing with it," Gartner's Milanesi said.