At its Google+ press event, Google is currently holding in San Francisco, Vic Gundotra has just announced major updates and the maybe most important one is that Google Hangout will become the unified client for conversations; by including chats and SMS aka text messages. Other new features, which are said to come to Google+ and Hangouts soon are support for animated GIFs and an easy option to share the current location (after Google axed its popular Latitude feature in Google Maps recently). Gundotra has yet neither said how MMS messages might be handled (yes, MMS aka Multimedia Messaging System, is still out there and used) and how this feature might interfere with OEMs SMS clients, like HTC Sense or Samsung TouchWiz.
For now, this features are only announced. The updated Google Hangouts app is yet not available from Google Play.
Cheers ~ Arne