The current global economic conditions pushed Nokia to withdraw from the Japanese market, said Thomas Jonsson, a company spokesman. Faced with lower demand for cell phones the company is examining its operations worldwide and decided that development for the Japanese market is not a priority.

"We've not reached our own internal targets over a sustained period," he said but declined to say what those targets were.

Nokia will keep a research and development center open in Japan and continue its procurement activities, said Jonsson. The plan also won't affect its high-end Vertu brand handsets. A recent press report, which Jonsson declined to comment on, said Nokia would launch an MVNO (mobile virtual network operator) next year through which it would provide service for Vertu.

The company was active in Japan in the 1990s, supplying handsets for the country's proprietary second-generation PDC networks, but pulled out of the market. It reentered earlier this decade when 3G services began and has had one or two handsets on sale ever since through NTT DoCoMo and Softbank, which both operate WCDMA (wideband code-division multiple access) networks.

Nokia's decision probably says more about the Japanese market than it does about Nokia. Handsets from NEC, Fujitsu, Sharp, Panasonic and other domestic makers, which are typically developed in close cooperation with carriers and highly tuned to local tastes, are most popular here and no foreign phone maker enjoys the same level of popularity here that it does in other major markets.