This is a serious danger to your privacy and this service has been found deployed in many Android handsets and there is a craze around the internet about this as people are angry about the fact that the carriers have been spying on them without their permission.
This service has been found pre-installed in most of the Android handsets (excluding some) and has been capturing your keystrokes, SMSs, browsing activity, etc. and sending them to a third-party. This has been clearly proven by a person in the following video-
And the bad part of the story is that you are opted in without your permission and in fact you cannot even opt-out of it!
This Carrier IQ spyware as shown in the above video shows under "All applications" but not "Running application" but still there is an option to "Force Quit" the application but it doesn't work.
I don't even think that there is a thing called "privacy" in the world today. Even if a carrier wants some info about their users phones in this manner, then they should actually ask for their permission at least!
A similar spyware is also reportedly found in iOS 5 but it has been proven to be disabled by turning off "Send Diagnostics and Usage data" in settings. I would say that this is a better way to ask for the same info needed.
This is a serious issue for those privacy-freaks out there and I hope the carriers bring down a solution to it soon or at least give a statement about it.
Nokia has issued a statement saying that no Nokia device ships with the Carrier IQ software pre-installed.