Last week the University of California CIO, Peter Siegel, and several IT council members sent a letter to staff that they have decided to end their GMail pilot. The goal was to make GMail the primary mail system for the 30,000 faculty and staff at the University. But the faculty expressed doubt that Google could keep their correspondences private.

Jeff Keltner, a business development manager in the Google Apps for Education group told InformationWeek "Obviously there's lots of opinions and voices on campuses. By and large, it's not typical of what we're seeing in the market. We're seeing lots of schools move their students and faculty onto Gmail," said Keltner, who also noted that UC Davis students are continuing to use the service and that Gmail users' privacy is protected by contractual assurances that govern data handling. "

Part of the concern expressed by the university was the privacy problems that came up with Google Buzz when it was released. When Google Buzz was released users who chose to enable it gave anyone they followed a peek into who they emailed and chatted with the most. This was fixed pretty quickly by Google but was still a factor in the Universities decision.

The University IT leaders also said that after review policies they found it may violate the UC Electronic Communications Policy which forbids the university from disclosing or examining the contents of e-mails without the account holder's consent,and from distributing the e-mails to third parties.

This announcement is a blow to Google who is trying to expand it's presence in the enterprise market.