The 160-character text limit came from an engineer counting letters at home
In 1984, Friedhelm Hillebrand of Deutsche Telekom sat at his home typewriter writing random sentences and tallying every letter, digit, space and punctuation mark. Nearly every message came in under 160 characters. That rough experiment set the length of the SMS text, a format later used by billions of people.
Hillebrand and Bernard Ghillebaert of France Télécom took the idea to a meeting of the GSM mobile standards group in Oslo in February 1985, and engineering teams turned it into a working service. The first text was sent on 3 December 1992, when a 22-year-old test engineer, Neil Papworth, typed Merry Christmas on a computer and sent it over the Vodafone network to Richard Jarvis at a party in Newbury, Berkshire. Papworth later recalled that the moment did not feel momentous at all.
Adoption started slowly. In 1995 the average GSM customer sent just 0.4 texts a month, partly because operators were sluggish in building billing systems and stopping fraud. Finland led the way: Radiolinja launched the first commercial person-to-person service in 1994, and when a rival followed in 1995 with cross-network texting, Finland became the first country with a competitive market for it.
Then texting exploded. By the end of 2007, some 2.4 billion of the world's 3.3 billion mobile subscribers were active users, and more than 85 percent of people in Finland, Sweden and Norway texted. The Philippines became a texting powerhouse, sending over a billion messages a day in 2008. For operators it was hugely lucrative: a message of about 190 bytes is so small that more than 350 fit into the data capacity of a single minute of voice call.
The idea is far older than phones, since electrical telegraphs were sending text in the early nineteenth century, and the German postal service launched the first telex network in 1933. Texting's own dominance is now being eroded by internet messaging apps, which one 2013 forecast expected to match SMS volume that year at nearly 10 trillion messages each.
Source: Text messaging