In a suprising move, Palm today announced the company has decided "to
cancel the Foleo mobile companion in its current configuration" and focus on the next generation OS for their smartphone products.

In a statement on Palm’s blog, Palm CEO Ed Colligan wrote:

"As many of you are aware, we are in the process of building our next generation
software platform. We are very excited about how this is coming together. It has a modern, flexible UI,
instant performance, and an incredibly simple and elegant development environment. We are working hard on
this platform and on the first smartphones that will take advantage of it.

In the course of the past several months, it has become clear that the right path for Palm is
to offer a single, consistent user experience around this new platform design and a single focus for
our platform development efforts. To that end, and after careful deliberation, I have decided to cancel
the Foleo mobile companion product in its current configuration and focus all our energies on delivering
our next generation platform and the first smartphones that will bring this platform to market. We will,
of course, continue to deliver products in partnership with Microsoft on the Windows Mobile platform,
but from our internal platform development perspective, we will focus on only one.

Because we were nearly at the point of shipping Foleo, this was a very tough decision. Yet I am
convinced this is the right thing to do. Foleo is based on a second platform and a separate development
environment, and we need to focus our efforts on one platform. Our own evaluation and early market feedback
were telling us that we still have a number of improvements to make Foleo a world-class product, and we can
not afford to make those improvements on a platform that is not central to our core focus. That would not be
right for our customers or for our developer community.

Jeff Hawkins and I still believe that the market category defined by Foleo has enormous potential.
When we do Foleo II it will be based on our new platform, and we think it will deliver on the promise of
this new category. We’re not going to speculate now on timing for a next Foleo, we just know we need to
get our core platform and smartphones done first.

I would like to thank our customers for their interest in Foleo. I know there will be disappointed
folks who were looking forward to carrying a Foleo for all their mobile computing needs. I am certainly
one of them. I would also like to thank the developers who have supported our Foleo efforts. They have
been loyal to Palm and have worked hard to deliver some compelling solutions on the Foleo platform.
I know that they will understand that the right thing to do for the long run is to focus on one platform
that will live for years, rather than invest energy in a one-off solution. We will make every effort to
make sure we bring our developers forward to our next generation platform.

This decision will require us to take a limited charge of less than $10 million dollars to our earnings.
This is a lot of money, but it is a small price relative to the costs that would be required to support
two platforms going forward. This decision is in the best interest of our customers, our team, our
products and our shareholders. I hope this renewed focus at Palm will allow us to deliver more compelling
solutions to our core smartphone market, and it will allow us to position ourselves for the long run around
one Palm experience.”