Harvard has ultimately decided not to participate on the
terms reached by the libraries involved in the settlement
discussions between Google and the publishers and
authors.

from the Harvard Crimson -
http://www.thecrimson.com/article.aspx?ref=524989

"Harvard University Library will not take part in Google¹s book
scanning project for in-copyright works after finding the
terms of its landmark $125 million settlement regarding
copyrighted materials unsatisfactory, University officials
said yesterday.

"Harvard had been one of five academic libraries--along with
Stanford, Oxford, Michigan, and the New York Public Library--to
partner with Google when the book scanning initiative was
announced in October 2004. University officials said that
Harvard would continue its policy of only allowing Google to
scan books whose copyrights have expired.
...

"In a letter released to library staff, University Library
Director Robert C. Darnton ¹60 said that uncertainties in the
settlement made it impossible for HUL to participate.

"³As we understand it, the settlement contains too many
potential limitations on access to and use of the books by
members of the higher education community and by patrons of
public libraries,² Darnton wrote.

"³The settlement provides no assurance that the prices charged
for access will be reasonable,² Darnton added, ³especially
since the subscription services will have no real competitors
[and] the scope of access to the digitized books is in various
ways both limited and uncertain.²

"He also said that the quality of the books may be a cause
for concern, as ³in many cases will be missing photographs,
illustrations and other pictorial works, which will reduce
their utility for research and education.² "