As an app developer, saying "I am not a huge fan of piracy" is an understatement. Apple has created a platform on which the cost of software has dropped dramatically, to the point where you can buy the entire top-fifty App Store list for little more than it would cost you to buy a single console game. Thus, when people spend hundreds of dollars on a device (and, often, hundreds more on accessories) and then feel compelled to pirate 99-cent apps, I must admit that I'm more befuddled than angry.
Alas, there will never be a shortage of arguments against--and in favor of--piracy. Pundits will continue to point out that it's illegal and immoral, and proponents will continue to herald it as a form of populist protest against powerful and arrogant copyright lobbies.
Inevitably, then, discussions around this topic are rarely fruitful, since matters of morality have a way of being colored by each person's own bias, and the legal implications of piracy are, on the whole, fairly modest for the average user. Personally, I find the practical consequences of installing pirated software much scarier than the prospect of being sued or prosecuted for copyright infringement.
The danger zone
One consequence of our increasing use of--and reliance on--iPhones and iPads and the like is that those mobile devices tend to contain an increasing amount of highly sensitive information about us. Like my Macs, both my iPhone and iPad are laden with all sorts of passwords, account numbers, banking information, and just about everything that an ill-intentioned person needs to completely ruin my life. The same applies to the devices that belong to most of my friends and other adult members of my family.
However, mobile devices can be much more dangerous than their desktop computer cousins. It's definitely possible that someone will break into my house and steal my Mac, but it seems likely that I will, one day, leave my iPhone on a train, or that someone with sticky fingers will bump into me in the street and relieve me of its presence.
Closed but safe
Apple has long known this, and the folks from Cupertino have worked hard to make sure that iOS is as safe a platform as possible. Thus, for example, If I should be suddenly separated from one of my devices, I would have the option of using Find My Phone to recover it--or, at the very least, to remotely wipe it before the bad guys could wreak too much havoc.
But physical security is only half of the solution: The other half comes in the form of Apple's closed software ecosystem, which only allows users to install Apple-approved software, and uses a technique called "sandboxing" to prevent apps from interfering with one another by accessing memory and data that doesn't belong to them.
There are all sorts of downsides to this approach, not the least of which is that Apple has maintained a tight grip over which apps make it on the App Store--sometimes with questionable results. However, there is also a major upside: iOS remains relatively safe from the installation of malicious software. I can let games and banking apps coexist with the knowledge that one won't play hokey-pokey with the other and surreptitiously help someone in a non-extradition country steal all my money. (Or, almost as bad, my high scores.)
Once you let pirated software on a device, however, this protection is largely compromised. Nothing prevents an ill-intentioned hacker from distributing a pirated version of, say, a popular password-management software that has been rigged to capture every keystroke and transmit it across the Internet to a remote server, where someone who just can't wait to ruin your life is standing by. Most significantly, this could be done in such a way that even the savviest of users wouldn't be able to tell without some in-depth analysis.
Making a run for it
What about jailbreaking? Jailbreaking is neither immoral nor, in most jurisdictions, illegal. And for good reason: It allows well-intentioned developers to explore the ins-and-outs of iOS, learning more about the way the operating system works and expanding its capabilities beyond what Apple mandates.
However, jailbreaking also eliminates the portion of iOS that prevents apps from peeking into each other's sandboxes. If used conscientiously, this is not necessarily a problem: Reputable developers of jailbroken apps are no more likely to try and steal your data than any honest software maker listed on the official App Store. On the other hand, pirated software or other maliciously-crafted apps that are allowed on a jailbroken device could install viruses that happily scour your information for juicy bits about your personal life, delivering them into the hands of the wrong person.
It's a scary thought, and this nightmare scenario is far from tin-foil-hat fear mongering: Windows users have had to contend with this kind of problem for years, often brought on by the installation of Trojan horses attached to pirated software. If there's just one reason to keep everyone away from pirating those one-dollar apps, this is it. And if the moral and legal implications provide extra fodder for your keeping your iPhone free of such software, so much the better.