Well, this took a while. It's been the most frustrating experience having Hangouts since it rolled out, because of this exact issue: I based everything on GrooveIP at the time, having a small voice plan but unlimited data. Then Hangouts showed up and everything became messy (I still hate hangouts, putting SMS and web chat at the same place is very confusing for the average user) I wrote this a bit more that a year ag…
Apple and WinPhone do this fine and it's an excellent idea in a world where SMS is overpriced that the app should automatically look for free ways to get the message to the target seamlessly.
I look at Hangouts the same as I look at Plus - great idea to integrate the myriad things into one place and consolidate a zillion balkanized Google products... but Google just isn't good at doing that.