Palm CEO Ed Colligan sent out a mass email to the company's customers yesterday, and the news it contained was quite a surprise. "I have decided to cancel the Foleo mobile companion product in its current configuration," he wrote.

The hit to the company, Colligan said, will be less than $10 million - which doesn't seem like all that much, considering the prominence it had given to the Foleo over the past few months.

InfoWorld's Zack Urlocker says it was a good call. "At 2.5 pounds, and 5 hours battery life, the only thing the Foleo had going for it was a full sized keyboard and the low price," he writes. "But it wasn't actually portable enough that you'd want to take it anywhere you wouldn't rather have a PC."

Still, it doesn't make Palm look good. Not only is Palm's development of new products slowing to a snail's pace, but as the Washington Post's Rob Pegoraro notes, "The Foleo cancellation certainly won't raise Palm's popularity among the third-party developers that had signed up to write software for the Foleo."

More here from Forbes ... and more here from InformationWeek.