Telecoms.com discusses the two:
Logically, of course, IM is a more convenient and flexible service than SMS, as well as real time. SMS, however, is the only mobile data service that is almost completely interoperable and, more to the point, even if they slash prices per SMS, operators are still making a fantastic margin from something that costs next to nothing for the carrier to send. As Jeff Wilson, chairman of Telsis, a company with a strong background in messaging systems, says: “Despite predictions in the past of the death of SMS, it has continue7d to grow. People know it works and are familiar with it.”
But IM and email are very user-friendly aren’t they? Well, yes – if the user happens to be sitting in front of a PC or a Mac. Sending long messages on a phone is an arduous task. What about presence? Presence is something SMS cannot offer. But it is far from proven that, outside the fixed environment, many texters are that bothered about presence, or indeed whether users, many of whom still need guidance to lock their keypads, will really go into their phone’s menu and get online to set a mood or IM profile.