How does "Angry birds backup" app work? "Angry Birds Backup" seems to be a third party app that modifies other application's data.

This should not be possible from security point of view, as it enables you to create malicious software.

So how does that backup program work?

It works on my nexus one, but phone is not rooted.
Application only asks for the network and sd card access. the former could be required for ads only (have not checked the paid version yet)
According to the Android Dev Guide, files written to the internal storage such as the Angry Birds data cannot be accessed by other applications by default.  I'm guessing that Rovio used MODE_WORLD_READABLE instead of the default, however.  Maybe this was a mistake or maybe they plan on having future apps being able to read your progress and unlock sometihng, or whatever.

Of course, this doesn't bar the possibility that an Android exploit is being used to bypass the file privacy, but who really knows besides the author of the backup app?