"The tablet effect is real," said HP CEO Leo Apotheker "and our TouchPad has not been gaining enough traction in the marketplace." And thus ends HP's decidedly short-lived venture into the tablet market.

The company is calling it a transformation: at Thursday's earnings call, HP shareholders were informed of the company's plans to shift gears, potentially dropping their role as the world's largest PC manufacturer in favor of focusing on the more lucrative sides of their multi-faceted organization.

The news about HP's WebOS platform (in addition to ditching the TouchPad, the company is also discontinuing WebOS phones) is not altogether surprising. Consumers have spoken, and in light of the TouchPad's , the fact that HP has decided to scuttle production of their ill-received tablet a mere 6 months is likely in their best interest, financially.

But the announcement that the company is also considering a "full or partial separation of the Personal Systems Group" still comes as something of a shock. (The PSG is the division of HP that produces desktops and laptops.) Truth be told, the writing has been on the wall for some time. Consumer interest in traditional PCs has waned, thanks in no small part to . HP's Desktop and Notebook revenue dropped 4% since last year's 3rd Quarter report, and while the PSG division remain profitable, falling revenue and shrinking margins coupled with the failure of their own attempt at breaking into the tablet arms race has likely soured the company on sinking any more resources into a division whose end is likely nigh.

Before HP announced its groundbreaking news, new sales figures showed that HP had slipped behind Apple in sales of laptops and tablets. Apple shipped 13.6 million units, 10 million of them iPads. That meant that Apple sold more iPads than HP did laptops (the company shipped 9.7 million notebooks in the period).