It was true. Twitter heavily emphasized SMS back when it was new.
The 140-thingy limit hasn't been about SMS for a while now, and has just transitioned into a weird artificial limitation that's become part of what Twitter is. But that is how it started out.
Secondly, an SMS is limited to 140 bytes, which is 160 7 bit 'characters', or 140 8 bit 'characters' or 70 16 bit 'characters' (in UCS 2, normally).