SMS is definitely not free. You may have a bundle that includes X (or unlimited) amount of SMS, but there are plenty of subscriptions out there (maybe not in the US) that charge by the SMS, or come with bundles of only having, say, 50 free SMS per month.
In all fairness, no one uses SMS, and no one uses iMessage (outside of the US maybe?).
WhatsApp is omnipresent in Singapore. For example, every business, every support channel, every delivery company uses WhatsApp. WhatsApp QR codes are everywhere (similar to QQ/wechat in CN).
Most iPhone users I know in Singapore never even set up their iMessage (which is also only available on iOS and is a total pain to get to work if you're dabbling in various sim cards, as is very common in SEA). So yes, there's a very good reason WhatsApp is very popular in some parts of the world (similar to BlackBerry Messenger (BBM) until quite recently in Indonesia). It's become too big to fail and took over a very very big portion of (private/business) communication in many parts of the world. And it 100% needs more regulation.