So far Google are the only large player to use Jabber as their protocol.

Well said.

Reminds me of McLuhan's famous statement, "the medium is the message," from his book, "Understanding Media."

He writes, "this is merely to say that the personal and social consequences of any medium—that is, of any extension of ourselves—result from the new scale that is introduced into our affairs by each extension of ourselves, or by any new technology. [...] Many people would be disposed to say that it was not the machine, but what one did with the machine, that was its meaning or message" (p. 23).

Indeed, Apple knows this all too well.

But I dont see Twitter or any mobile chat application replacing SMS until it is an industry standard. As other people have mentioned. SMS works on every handset produced in the last several years. (In the UK i can remember having my first SMS enabled handset, an Ericsson, in 1998) There could be an amazing iPhone mobile iChat application tomorrow, but as i only know one other person with an iPhone it would be severally limited in scope sas far as actually communicating goes!

Also, in Twitter you can send direct messages to someone as well if you want to communicate with just that person.

Check the linked patent screenshot. It is coming, but who knows when.

I am giving Twitter a spin too http://twitter.com/ichadman

a)Any handset can get a text. b)I don't want to sign up for any more web services, I have too many already. c)I don't want social applications, not facebook not twitter not any of them. d)I don't want to talk with anyone I wouldn't give my phone number to.

What I do want is for people to stop telling me what I should want (especially Apple) and give me what I do want which is Multi-Media SMS on my iPhone (that's along with copy and paste, spell check in mail, multi signatures in mail, the ability to take video, the ability to manage files on the phone and a few other goodies that every other Smart Phone in the world has).

I agree. IM is the replacement for SMS. Using Twitter is like buying drugs or a gun on the streets... you have to know someone who's already involved in that community for an intelligible explanation of what's it's about. Their web site Help page is useless. Less convenient, indeed.

To Twitter, you need a PDA/Smartphone for the most part, SMS integration was cut off from Canada because of the cost, and you need a Twitter account. This makes the whole thing a lot less convenient.

Personally I think IM (MSN/GTalk/Etc) will basically replace SMS as more phones support it. Now if the iPhone could only receive those type of messages in the background like every other smartphone can already.