"Mips – processing cycles, computer power – had always been cheaper than bandwidth. The computers got cheaper by the week and the phone bills stayed high by the month." - The Star Fraction, 1995
If the goal is to optimize for server bandwidth, wouldn't you still want to send the already-blurred photo? Surely that will be a smaller image size than the pre-blurred full res photo (while also reducing client-side CPU/OS requirements).