Friedhelm Hillebrand, who set the 160 character limit for SMSes in the first place, took his cue by analysing the average lengths of typical kinds of 'short' messages:
Alone in a room in his home in Bonn, Germany, Friedhelm Hillebrand sat at his typewriter, tapping out random sentences and questions on a sheet of paper.
As he went along, Hillebrand counted the number of letters, numbers, punctuation marks and spaces on the page. Each blurb ran on for a line or two and nearly always clocked in under 160 characters.
Still, his committee wondered, would the 160-character maximum be enough space to prove a useful form of communication? Having zero market research, they based their initial assumptions on two "convincing arguments," Hillebrand said.
For one, they found that postcards often contained fewer than 150 characters.
Second, they analyzed a set of messages sent through Telex, a then-prevalent telegraphy network for business professionals. Despite not having a technical limitation, Hillebrand said, Telex transmissions were usually about the same length as postcards.
-- LA Times
Twitter's tremendous success seems to confirm this analysis!