Two days after being pushed two notches down by Moody’s Corporation (NYSE:MCO); Nokia Corporation (NYSE:NOK) has cancelled its Meltemi OS project, in order to tighten up on costs. It is now confirmed, the company has completely scrapped Meltemi off its product line up. This news came from three sources with direct links to the information, reports Reuters.

The driving force behind Meltemi, was replacing the aging series 40 software in mid-range phones (something between smartphones and basic phones).

Nokia Corporation (NYSE:NOK) has been pushed to the edge this time, as it has been forced to forgo otherwise profitable ventures. Meltemi had the potential of being a real game changer for it. It would have played an instrumental role in fortifying Nokia’s strong position in the mass-market, as well as giving it the strength to push through into the smartphone market. According to IDC- the research firm- Nokia has its leash on more than 20 percent of the mass-market.

Mass market basically refers to the market populated by the average income earner. Phones, more often than not, retail at prices in the range of $100 to $200.

While Nokia Corporation (NYSE:NOK) has never officially confirmed the existence of a Linux Based Meltemi operating system, a leaked video, released mid last year, featured chief executive, Stephen Elop, flagging the existence of the OS.  The company has  declined to give into requests for comments.

Choosing to seek refuge behind the veil of silence suggests that Nokia is jittery, as disgruntled investors continue pressing for visible results.

The company is wedged between a rock and a very hard place, now that it has slipped way below the break-even point and posted disappointing losses.  All the same, the company has heightened the tempo in its cost cutting programs, as it intends to conclude talks over job cuts this week in Finland.

Earlier on in June, Nokia did confirm that it would lay off 10,000 workers, in its attempts to restore hope to its bottom line.

Now that Nokia has cut off Meltemi, speculation is rife, as it so happens that the OS was supposed to be on the market by now. One of the sources confirmed this.

While cutting off Meltemi was not previously in context, it has come short of surprise. At least this is what Pete Cunningham, an analyst with Canalys, believes. “With the pressure to make extreme cost-savings, it is little surprise that it has been cut,” he remarks.

Nokia’s current series 40 platform gleaned 2 billion sales, exclaiming its dominance in the market. Nonetheless, Nokia’s hopes of making an inroad on the higher tier smartphone market seem to have hit the wall, as Android still controls more than half of that market.