As a few examples, there are a variety of social-network applications (LinkedIn, Facebook) that request access to your platform specific contacts application. They then do a variety of interesting things with them, such as suggesting users with numbers they have "on file" as potential new "Friends", etc. This is seemingly server-side.

Whatever you're using to sync contacts, without syncing them to this contact app, it seems (to me) as useful as keeping a textfile full of phone numbers in Dropbox. You won't have any useful prompts telling you that it's Dave phoning you, John texting you, or Alice's number to phone/text.

This is, admittedly, neatly worked around by keeping your permission requests under control, but... stuff like this[1], from before the granular permission system on Android was available, are annoying.

1: http://bgr.com/2011/08/12/facebook-stole-every-contact-and-p...