That privacy policy is brutal, and it's just for their analytics and enabled unless you opt out in the settings. The application runs just fine without all of this data being sent to them. You're giving them your bookmarks, call history, contacts, favorites, gestures, app launch times, location, SMS metadata, notifications and internet searches.
If opt-out happens after install, I would expect that your phonebook and such have already been transmitted before you are able to opt-out. But maybe the opt-out option occurs before/during install?
That's a stupid amount of data. I kind of wish I didn't care about all that, but taking a copy of my contacts and location it just rubs me the wrong way. It's not worth it.
It's important to note that just because an app requests access to something doesn't mean that something is being shared with the publisher. The app could request access to favorites and contacts to be able to import them as icons into the launch area, for example.
I'd like to see the actual uses of the requested permissions added as legally binding commitments by the app developer.
Android does this thing now (which is cool as far as it goes) where it warns you about everything an app could hypothetically do with the access it needs. It's the equivalent of getting a warning every time you install a desktop app saying, "This app could: Delete all your files; Steal your email; Record you on your webcam without your knowledge ..."
What Google could do is add a little "details" link after each requested permission, with a text field from the publisher. Like, "This permission is used to: show icons of your favorites and contacts in the launch area."
The Play Store agreements could clarify that these are legally binding commitments the publisher is making directly to the user (meaning the user could sue if the publisher lied), and require the user to re-approve if the text changed.
That wouldn't stop random developers from just lying, but it would make it pretty likely that an app from Nokia or Yahoo or Disney or whatever was only doing what it said.
It's important to note that while you might have granted the app permission to access your bookmarks for that purpose, it doesn't prevent them from changing that behavior in the future and you'd be none the wiser since you've already granted them the keys to the kingdom.
https://www.zlauncher.com/privsupp.html