When you power up, the PS3 will have to format the new hard drive.

You may see a message similar to the following, 'The system software cannot be run correctly...Insert storage media that contains update data of version 4.11 or later, and then press the START and SELECT buttons at the same time...'.

If you are trying to restore a backup to your new hard drive, and, after following the steps from the previous message, you receive an error message similar to the following, 'The data is corrupted (8002F225)', then you may need to grab the latest PS3 System Software Update from http://us.playstation.com/support/system... before the system will be able to format the new drive.

Hit 'X' and continue until the formatting is complete.

Once the formatting is done, go to the 'Settings' XMB option and select 'System Settings' then go to 'System Information'

You should now see the storage capacity of your new hard drive.