Problem

Suppose you have a new smartphone and are excited about the range of apps available for it. You read about a really interesting new game that is available for your phone. You do a quick Web search for it, and see that a version is available from one of the free marketplaces. When you download and start to install this app, you are asked to approve the access permissions granted to it. You see that it wants permission to "Send SMS messages" and to "Access your address-book". Should you be suspicious that a game wants these types of permissions? What threat might the app pose to your smartphone, should you grant these permissions and proceed to install it? What types of malware might it be?