Android phones have been released in 46 countries, yet the ability to purchase apps in Android Market is available in only 13 countries. Some people think that this is an invitation for piracy. You have this cool phone, made cooler by the addition of apps. Some of the better apps cost money. Without legitimate access to those apps, many people turn to piracy.
Sweden is one such country that does not have paid-apps. Swedish blog Royal Pingdom puts it this way:
We all like free, right? But the reality is that it can be bad news for developers if that mentality goes too far.
If Google doesn't quickly make it possible for users in more countries to easily pay for apps, the company may create a long-term problem. People in those countries will simply get used to pirating their apps. They will get used to all Android apps being "free."
So what happens once these users finally have proper access to paid apps? Sure, some of them will be paying, if nothing else because it's more convenient, but the risk is that a significant portion of users will not like the idea of suddenly paying for something that so far has been available at no cost. Google will effectively have created "pirates" out of people who may otherwise not have gone down that route.
To say that this would severely hinder Android developers from making a living is an understatement.
I think another way that Google enables piracy is by making it very easy to install paid-for apps, that you yourself did not pay for. Using a connection to a computer, you can easily "pull" an app off your phone and upload it to a file-sharing service. Someone else can download it and install it. This issue is actually of benefit to Google, but it must irk developers. By allowing paid-for apps to be easily pirated, it encourages developers to make the app free, but subsidized by advertising. We all know how Google makes most of its money.
Regardless of whether this piracy is beneficial to Google in the short-term, it is something they need to deal with. Developers are starting to flock to Android in droves, and they should not be discouraged for fear of piracy.