Telegram. An Obituary. Stop

Recently, while we were discussing a problem involving communication and precision of signals in economics, over lunch, the fact that one wouldn’t any longer be able to send telegrams in India somehow cropped up.

One of us representing the younger generation (Chandan) confessed, somewhat embarrassedly though, that he had no clue what a telegram was even while he had heard the term. No wonder, concluded the other shocked co-author with the greying beard (Sudipta) — the only ones really protesting the termination of Bharat Sanchar Nigam Ltd’s (BSNL) telegram services are the state-owned company’s employees who possibly stand to lose their jobs!

The shocked co-author, then, proceeded to recount his favourite telegram story.

Back in the days while he was still a student, the hostel where he was staying had just one phone for its 100-plus inmates.

This solitary instrument was unavailable most of the time for most of the residents, since it was hogged by the half-a-dozen or so Romeos who clung to it to make up for the physical absence of their Juliets.

Hostellers those days typically communicated with their parents by means of letters — and, no less important, money orders.

One day, the erstwhile young co-author received a telegram from his folks, who hadn’t heard from him for some time. It just said, “ Silence causes worry .” Not to be outdone, he immediately rushed to the post office and fired back: “ Speech is Silver, Silence Golden .”

That was enough for the parents to breathe a sigh of relief. Despite no missives or vocal communication from their dear son, silence wasn’t cause for worry any more. Those five telegram words were confirmation that he was fine.

Cut to the present

As our conversation ambled along, it became clear to us that the three most important aspects of communication are speed, precision and relevance.

In this age of email and texts, we can receive and send messages quicker at much lower costs with greater efficiency. Telegrams, on the other hand, were relatively slow and expensive. They also needed to be very precise and used only when required — even if not necessarily as a harbinger of bad news.

In 1985, there were 45,000-odd post offices across India that sent and received some 60 million telegrams — taar , literally wire, in local language — a year. That number has since fallen to an estimated 1.8 million, with only 75 offices remaining in operation. And with effect from Sunday night, BSNL has ceased to offer the service altogether.

While receiving a telegram could (we can now, indeed, talk in past tense) take up to two days, one can send and receive messages via cell-phones and the Internet almost instantly. Moreover, they can be used for both verbal and visual communication. While a telegram of up to 50 words would have cost the sender roughly Rs 27, it is less than Re 1 for a text message of 160 characters with the added benefit of instant delivery. It is even better with emails, where messages of practically any length can be instantly sent for free. But it wasn’t at all like this when cell-phones became first operational in India and VSNL started its Internet services around 1995.

It took another 10 years for these to be available at affordable cost to the aam aadmi . Thus, for around 150 years — the Indian Post and Telegraph Act of 1854 is proof of it — the telegram remained the most cost effective and, hence, most used means of speedy communication.

Fixed cost economics

However, there is one major cost aspect distinguishing the current modern means of communication from the antiquated telegraph: fixed costs. To send a text message or an email, you need a cell-phone or a computer and also pay a monthly service fee.

In other words, there is a fixed cost for accessing the technology, though once that is paid, the marginal cost of an email or text message is virtually zero. As more and more messages are sent, their average cost (variable plus fixed) also approaches zero. This is a typical feature of all information goods: high fixed costs with zero marginal costs. In the case of a telegram, the user does not incur a fixed cost, but there is a substantial marginal cost for every use. As a result, telegrams were used mainly in exceptional circumstances — like what was once encountered by the shocked co-author with the greying beard in his angry-young-man days.

The downside

On the other hand, the zero marginal cost of sending emails and text messages naturally engenders a tendency for overuse.

Equally, one tends to receive unwanted stuff, meaning we now have to set aside time for separating the important messages from the trivial.

We all probably know that ‘one person’ who keeps filling our mailbox with silly jokes that he couldn’t have afforded with the telegram. We have all certainly got text messages or telemarketing calls at inopportune moments, besides hearing stories of senior citizens defrauded through some email-mediated financial scam.

The fact that a ‘spam’ usually does not come with an opt-out provision for the receiver can, by itself, impose significant costs. According to the 2013 Internet Security Threat Report, despite a substantial decline in percentage terms, about 30 billion spam messages were sent daily to valid email addresses last year. Spams generate what economists call ‘negative externalities’. An externality is a cost or benefit for some other person that a consumer or producer does not take into account.

Thus, vaccinations generate positive externalities by reducing everyone’s probability of getting the disease, whereas smoking creates negative externalities by imposing costs on passive smokers too. Spams impose negative externalities since senders simply don’t care about the burden they impose on the hapless lots of receivers.

Justin M. Rao of Microsoft Research and David H. Reiley of Google Inc found that while the benefit to spammers from their activities worldwide was worth only $200 million a year, the cost to American firms and consumers alone was $20 billion at the most conservative estimate.

Given the lack of fixed costs and zero costs of dealing with spam, the end of telegrams may spell bad news beyond its effects on BSNL employees.

The good news, however, is that International Telegram is set to launch telegram services in India from this month. Ironically though, you’ll need an Internet connection to send a telegram online through the itelegram.com Web site.

Interestingly, the first rapid long-distance telegraph communication system known as ‘semaphore’ used smoke signals, beacons or reflected lights. Today, a bunch of enthusiasts in France are trying to relocate the old semaphore message stations that preceded the advent of the electric telegraph to understand how they were used so efficiently by Napoleon, who created them for quick military communication.

Those who fear that they will miss their telegrams need not despair still. Who knows, quite possibly in the near future, some neo-Luddites might revive this seemingly antiquated communication tool. Until then… AU REVOIR STOP.

(Sarangi teaches microeconomics and game theory at Louisiana State University, and is also a Visiting Professor at KIIT University, Bhubaneswar. Jha is a doctoral student in Economics at Louisiana State University).

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