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The impact of spatial correlation on the performance limits of multielement antenna (MEA) channels is analyzed in terms of the diversity-multiplexing tradeoff (DMT) at finite signal-to-noise ratio (SNR) values. A lower bound on the outage probability is first derived. Using this bound accurate finite-SNR estimate of the DMT is then derived. This estimate allows to gain insight on the impact of spatial correlation on the DMT at finite SNR. As expected, the DMT is severely degraded as the spatial correlation increases. Moreover, using asymptotic analysis, we show that our framework encompasses well-known results concerning the asymptotic behavior of the DMT.