This first SMS sent 25 years ago from a computer and wished merry Christmas. In the beginning, phones could only receive text messages. There was no option to reply from your phone. SMS-capable phones became available in 1993 and slowly became more popular, turning texting into the preferred mean of communication. You can argue that since many hated SMS - in fact, before starting to use messaging services (like VIber), I hated texting.
In the beginning mobile operators charged more for texts and less for voice calls. Later this changed, and texting become the most affordable mean of communication but still expensive. OTT Messaging services changed that as well by making texting free as long as you have network connectivity (WiFi or 3G).
Only in 1999 it became possible to exchange SMS between different networks. Since then, SMS became a standard used by all operators and by many businesses.
In that extant, messaging today limit you to the specific service and this is why we use multiple messaging apps.
By turning our phones to more than just a dialing device, SMS can be considered the first step towards the modern smartphone. In fact, Twitter's 140 character limitation was inspired by the early SMS limitations (Twitter just recently made a controversial move to a 280 limitation).
"Texting" Flickr/smartsetpix, CC BY-SA
The evolution
Some time ago, the only way to communicate was to meet in person. In most cases you had to be dressed up, making sure you look fine to meet others.
With the invention of calls, people could talk while being away and even before brushing their teeth, but phone calls could still make us feel awkward. Most of us hate our own voice and the idea of someone hearing it making us feel a bit uncomfortable.
With SMS and nowadays with apps like Viber, people can text and when they don't have something smart to type, they can pick one of the many emojis and stickers available. Which sometimes can be even a better way to express how you feel. Texting also allowed us to communicate asynchronously - when calling someone, you are interrupting them and demanding their attention right away but with texting people can choose when to reply.
SMS also pioneered one-to-many communication - you could send the same message to many different contacts. Which today used to send us stuff we don't or all kind of confirmations and notifications from the services we are using (e.g. banking, post, clinic, etc.). Today, we got used to the convenience of group chats, which are secure, come with admin permissions and with the ability for us to leave or mute the groups we find less important.
From being diachronic to acceptance
People, mostly teachers and parents (but also young people themselves) were very concerned with the affect texting has on the language. Especially youngsters are using all kind of short-forms of words ("texting slang") and this made us diachronic. However, researches proved there was little effect on grammatical decline, mostly standing from typical anxiety about technology and progress (read more about such research by Nenagh Kemp here).
In fact, the texting slang proved to be important and helped to overcome the inability to read facial expressions, the body language and other cues we have when we communicate in person while texting (Sooo tru!).
Is SMS still relevant?
2012 was the top year for SMS, since then messaging apps took over. This also represented a more fundamental shift - moving away from a an open protocol used by all operators to a closed networks established by tech companies. The new services much more convenient and secure but require internet connectivity and to have your friends and family members using the same app.
There are still billions of SMS messages sent daily all around the world. Millions are still using simple mobile phones (not smartphones), which requires also smartphone users to use SMS from time to time. SMS is also more reliable for emergency cases for cross device and platform delivery (especially if connectivity is limited).
Also there is a lot of technology built around the SMS protocol and it used by emergency systems, the financial industry, marketing tools and many more. SMS also used as a 2nd step authentication and a way to verify the phone number of customers.
I do believe that eventually OTT will replace SMS. For example Viber already offering service messages for brands and services which are used instead of SMS to deliver richer personalised messages to consumers. The modern APIs allowing people to perform many actions (e.g. purchase products, consume content, etc.) beyond just delivery of notifications and linking outside.
Anyway, happy birthday SMS and soon Merry Christmas.