Amit Agarwal has made a good post about it. He says that Yahoo has been accused of supplying information to China, which led to the jailing of a journalist for "divulging state secrets".
Just like Yahoo!, Google can also become a "police informant" but for a noble and good cause - it can help the government catching software pirates who run warez websites from China.
He has also posted a picture which shows that warez website located in China is serving Google Ads but the main thing is that Google Adsense policies prohibit ads on sites with Hacking/cracking content. How did this particular warez site trick Google Adsense is also a major issue.
It would be great that if some of these pirates are caught. At least, the "real" programmer of particular software will get the reward when people Buy and appreciate his software and not these crackers!
Amit's blog is at labnol.blogspot.com/