Nokia drops MeeGo phone before launch (Reuters)

Mostly it was the multiple sudden switchovers that carpet bombed the momentum to death.

First they go N900, complete with a 300 device give away at a conference and a new Maemo version that was barely compatible with the old stuff (the user interfaces did not even line up). Instant community fragmentation. Then came the announcement that they would go Qt, when until then it had been all about GTK. Then came Meego. And finally one get the news that Meego would use RPM, when until that point it had been DEB (Likely pushed by Intel as Moblin went RPM with 2.x, and most of the available Meego releases are basically Moblin with some new graphics. The netbook and IVI versions still use GTK for interface for instance).

This, on top of existing grief related to closed source mixed in with the open stuff (Browser UI, hardware control) that made deep participation from the community difficult, basically alienating the old guard.

And funnily enough, i think having a non-phone device actually helped interest as it allowed people to separate the vital importance of a functioning phone from the inevitable breakage of tinkering. So if one tried to mod something on the non-phone devices and broke something one could reformat and start over, keeping important data on the memory card.