Features & Use
With the integration of SMS, Hangouts is positioned to be the central point of contact for communication with your circles. A Google account is required to use Hangouts chats and video calls are possible only with other Hangouts participants. However, SMS messages can be sent as usual. If you use Hangouts already, or plan to, then the new Hangouts is perfect because it combines both services into one app.
There is a distinction drawn between Hangouts chats and SMS conversations, with both being shown separately, even if they are with the same contact. A small icon on your contact's profile picture notifies you which messages were received as an SMS and as such, replying will mean you are paying for it on your mobile phone bill. Hangouts does not provide access to Google Voice either, which means that a Google number can not be redirected to Hangouts, also balances of Google Voice can not be used (as they can with the Gmail plugin).
The SMS functions in Hangouts are linked to the mobile phone number, meaning messages are stored on the device and not online, so they are not available on other devices. In the settings you can also disable SMS support, making Hangouts just an instant messenger app only. You can of course use any stand alone SMS app as well as Hangouts with SMS support disabled.
Other new features are the option to share your current location, the ability to let your contacts know which device you are on and when you are on a call, and what your current mood is, which you can set either as a displayed ''status'' emoji or at any time in a conversation through the many emojis available.
For video calls, there are unfortunately no costumes like we know from the desktop version of Hangouts, so the video stream can not be changed with funny insertions (hats, beards, glasses) or effects.
In the settings you can specify your Google Plus profile, customize notifications and link your mobile number with the Google Plus account.
Screen & Controls
Google Hangouts is simple and clearly laid out and appears in the current, bright holo-design style. On the New Hangouts page you can see the list of your contacts. A green Hangouts bubble indicates who is online. ''People You Hangout With'', ''Suggested People'' and ''Other Contacts'' are also available on this overview page.
A swipe to the right shows your last Hangouts that can be easily swiped offscreen for archiving. The app differentiates between chats and SMS conversations: thus, although it is clear that each message was sent or received, both types can not be grouped together in a continuous exchange with a contact. That would be a desirable option. Profile photos are also automatically defaulted to Google+, so if your contacts don't have G+ you'll only see a blank space unless you manually change them.
The most important functions such as starting a Hangout or video call, inserting emojis, inserting pictures or location, are available via self-explanatory buttons. With the context menu you can also set your mood, start group chats, customize notifications and make general settings changes. During a video chat you can easily switch between the view of yourself or your partner.
Speed & Stability
During the test period Hangouts ran fast and stable. Some users report problems with undelivered SMS messages, both when receiving and sending. This was not reproducible during the test with all messages being delivered as expected. Even in Android 4.4 KitKat there have been problems with the automatic retrieval of MMS which could not be traced during the test period. Video chat ran smoothly and fluently (with appropriate internet connection), and the call quality was encouraging.
Hangouts is available for free and offers a one-stop application for SMS and chat messages as well as video calls. If you have a stand alone SMS app Hangouts is still good value.
Personally, I have long used Hangouts in preference to Skype, because even with a waning internet connection the call quality is still acceptable. Plus, I find the combination of chat and SMS messages in one application very handy. It was, however, disappointing that Google Voice was not integrated into the new version of Hangouts. I would like to be able to use my voice credit for international calls or SMS in order to avoid mobile phone tariffs and roaming charges. It would also be desirable to have access to SMS messages on multiple devices and also to have online SMS backup, as is possible with chat messages. The existing features and functionality of the new Hangouts is convincing, but there's still room for improvement, hence a one star reduction.