Telegram offers encryption, and the client is free software. Anybody can check if the encryption is done properly. If you send your data to another persons server, it's not under your control anymore, no matter what kind of software is running on this server (after all, you will never find out if they really say the truth).

Now, it would be better if the server side was also free software, because it would be possible to set up our own servers and not be dependent anymore on telegram.

However, just because they didn't provide as much as free software as we hoped for, we shouldn't blame the developers.
They *did* develop free software and we should be thankful.
We can't blame people for not releasing code for software that they never even released. It's not that the server software is proprietary in the very sense - afaik, it wasn't released at all.

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