As others have said, normal users don't mind this. However this works best in applications which have an inherent benefit in connecting to a lot of people. So while this may work very well for linkedin and facebook, it may not work too well for say a youtube

It's a slippery slope - it certainly helps getting users to join, but it has implications on privacy and trust. That being said I think that most users will probably see it as a service and not a threat. The thing to notice here is that YC users and techies see the problems with this approach, but normal users don't. They just see the service, not the implications of it. So if you don't abuse it I think there are certainly cases where it makes sense to do.

I think the term "slippery slope" is far too overused.

I wouldn't use it either, but there must be some who do. Otherwise I couldn't explain that you can already buy the feature (e.g. http://www.getmycontacts.com)

Please don't do it this way. Google, Yahoo and Windows Live now all have APIs you can access to fetch contacts without having to handle the users credentials.

Getting contacts via delegated authentication should avoid aggravating the technophiles/hackers/security-aware (too much) whilst still allowing you to 'go viral'.

Whenever I get auto-generated invitations based on systems like these I delete and ignore them or alternatively tag them as SPAM if I receive them from more than one person.

It leaves me with a very negative impression of the site or service before I have even seen it.

It also makes me slightly angry towards the person who gave away my email address. Although most must be forgiven because they are not aware of what they did.