Color encodes useful information, especially for games. You can tell apart your friends (blue ships) from the enemies (red ships) or similar.
Before they had color, they also had textures to convey info.
Knowing when the other person is typing is NOT useful information. It will not tell you when you are going to receive your message. You get your message when the message appears.
Personally, IMHO, I find it useful, because it eliminates the need for more "Buddy, are you there? Answer me, are you on the phone? What are you doing right now? Are you still at your table?" kind of stuff. This is especially good if your buddy types quite slow, or if your buddy is typing a loooooooong message
