I caught a wonderful article in the NY Times about a woman who, in order to move away from a friendship, just stopped calling her friend. She called this the "bad boyfriend" approach after those immature guys who can't just tell you they want to break up, so they stop calling you and let you figure it out for yourself.
As a side note, I've never understood guys like this. To me, it's always better just to sit down and say, "Hey, I'm not feeling it" anymore when it comes to the relationship. The same is true for friendship. It might seem so easy to just stop calling a friend, especially if that person has a strong personality. But in the long run, you will probably end up feeling bad about letting that friend go, not because they didn't deserve to go, but because you handled it poorly.
Sitting down face-to-face is always the best way to go, but I realize that's a hard thing to do. But it's a temporary hurt. If you try and let the friendship just fade away, it might not work! Your friend may come on even stronger, wondering what your problem is. Then what do you say?
Can the "bad boyfriend" approach work? Yes, but only if the two of you are already drifting apart. If you're drifting, then just keep drifting. You don't need to make a declaration that your lives are different and you're moving on, because you'll already be demonstrating that with your actions, and most importantly, so will your friend. If you drift apart you can always drift back together again at some point, if the fates allow.
But if you try and push away someone by not calling, you're setting yourself up for guilt and bad feelings that you'll inevitably carry along to a new friendship. What's worse, you'll make your friend feel bad, too.