In case you haven't read it already, our editor-in-chief, Dieter Bohn, has an outstanding article up at sibling-site WMExperts highlighting his top 5 reasons Twitter is better than SMS (and vice versa).
There's a lot of intertube fuss about SMS lately, as a recent New York Times article once again shone the spotlight on the disgustingly dirty price gouging (and potential fixing) that goes on when it comes to SMS rates in North America. Basically, SMS (at 160 bytes/characters) is ridiculously cheap for the carriers to transmit, no matter what the scale, and yet the prices have doubled from $0.10 to $0.20 on many networks over the last few years. Voice, by contrast, involves much more data and is much more "expensive" in terms of infrastructure costs. North Americans will pay ludicrous sums of money for "cheap" SMS but not for "expensive" voice, so the carriers take advantage.
Dieter points out that the cost, community, compatibility, control, and context of Twitter give it a clear advantage of SMS, even as the discoverability, dilution of quality, dropping 20 characters, downtime, and potential delays in notification (outside the US) make it still far from perfect.
Flaws and all, Dieter is moving towards Twitter (@backlon) and away from SMS. Am I going to do the same? I already have (@reneritchie) and without really considering it. But here's the thing -- I have considered that not only should I not have to consider it, I don't think any iPhone user should. (Or any @theiphoneblog follower either!)