Blowing Hubble bubbles

Shock. Horror. SMS messages are more expensive than data transmission from the Hubble Space Telescope. So says a scientist at the University of Leicester.

Problem is, academics are often surprisingly ignorant of economics, whether in theory or in practice. This — and the fact that most haven’t ever worked for a private firm in the real world — may explain the appeal of radical-left politics among university faculties across the world.

This fellow, probably an excellent scientist, is an excellent example. He doesn’t recognise as simple fact that price has no relation to cost. None whatsoever. You cannot derive price from cost, nor infer cost from price. Impossible, unless the price is regulated.

(The scientists at physorg.com don’t know much about writing headlines, either, but we can let that slide since they don’t presume to write media analysis.)

Space scientist says texting is four times more expensive than receiving scientific data from space

A University of Leicester space scientist has worked out that sending texts via mobile phones works out to be far more expensive than downloading data from the Hubble Space Telescope.

Dr Nigel Bannister’s calculations were used for the Channel 4 Dispatches programme “The Mobile Phone Rip-Off”.

He worked out the cost of obtaining a megabyte of data from Hubble — and compared that with the 5p cost of sending a text.

He said: “The bottom line is texting is at least 4 times more expensive than transmitting data from Hubble, and is likely to be substantially more than that.”

He went on to explain that text messages comprise 140 bytes, which is £374.49 per megabyte.

He concludes: “Hubble is by no means a cheap mission — but the mobile phone text costs were pretty astronomical!”

Undoubtedly. We’ll let that pun slide too, but note that he’s not exactly comparing apples with apples, is he? My PC is also more powerful and expensive than the computer that drives the Hubble. Does that mean… what does that mean?

As Dr Bannister points out, data transmission from Hubble is measured in megabytes. Text messages are very many individual small messages, that have to be routed around the network separately. A similar comparison will find that internet access is vastly cheaper, per byte, than text messages, and that comparison likewise misses the point completely.

It may well be true that text messages are a ripoff. But a comparison with Hubble transmissions doesn’t make the point.

Price is simply an agreement between two people on the subjective value to one party of something the other has. If something cost me nothing to acquire, and has no real inherent value, but I then sell it at auction, did I rip anyone off? If item one cost me a million, but I can’t sell it for more than a hundred bucks, am I being ripped off? If identical item two cost me ten bucks, but I sell it for a hundred, are the tables now turned? Cost is one decision factor (of many) for a seller, because the seller may want to cover it, as one condition of agreeing to a transaction at a given price. Knowing the cost might also be a decision factor for the buyer, because he may choose to procure or produce the services or goods himself if he thinks that doing so will have more value. But cost is not, it is never, the basis or justification for a price in a free market. “Cost-plus” is a regulatory abomination, not a means by which price is discovered in a free market. And finally, there’s no such thing as a “fair” or “unfair” profit. By definition, in a voluntary exchange, the profit is fair no matter how high or low it is, otherwise the exchange wouldn’t have taken place.

If you think text messaging is too expensive, well, then don’t use it. Set up an alternative. Use instant messaging. Use voice. Stop waffling at your victims friends during movies or sports games. If you use text messaging, you’ve implicitly agreed that the price of a message is fair. Until operators can’t sell enough volumes there’s no reason, financial or moral, to reduce the price.

Instead of deploring the people who make commercial choices of which he disapproves, perhaps our scientist friend should express his gratitude to the involuntary payers of the tax that permits academics, sans economic nous, to download data cheaply from Hubble. And he might note that looking up the etymology of “nous” is pretty cheap, unless you prefer to buy a real, paper dictionary, or you choose to query an online version using text messaging.