Palmer, an undrafted rookie from Northern Illinois, signed Monday with the Indianapolis Colts. He confirmed the news on Twitter. He thanked the 49ers for giving him an opportunity.
Palmer had six catches for 83 yards during the preseason, and just made San Francisco's eight-player practice squad over several other recievers vying for a spot on the team. The practice squad is used to keep players on a team's roster that might be elevated to active duty for emergency purposes if there's an injury, trade or other roster movement.
However, other teams have the chance to sign anyone onto their 53-man roster from anyone else's practice squad if the need arises, and it was clearly necessary for the Colts after the Collie injury. Palmer could become an immediate contributor, or might just be there to provide quality depth for Indianapolis. It's unclear whether San Francisco will try and fill in that vacated roster spot at any point.