Ubuntu no longer collects popularity-contest statistics. This package is being kept for compatibility reasons.
The popularity-contest package sets up a cron job that will periodically anonymously submit to the Debian developers statistics about the most used Debian packages on this system.
This information helps Debian make decisions such as which packages should go on the first CD. It also lets Debian improve future versions of the distribution so that the most popular packages are the ones which are installed automatically for new users.