It's a lot of things, and Apple kinda backed into the lock-in aspect I think by mistake. At the time it debuted, you mainly used SMS when mobile texting, and SMS is garbage. It's not encrypted, was limited to a small number of characters, etc. Picture/video messaging also isn't part of the standard, so MMS was tacked on with massive limits, because the thing about SMS is that it wasn't really designed with it's own bandwidth in mind and instead piggybacked on the carrier signal in idle time (I'm real fuzzy on the details because it's been so long, if someone knows exactly that would be helpful context.) Most importantly, in the US at least, SMS was a fee carriers absolutely scalped you for. When iMessage came out, carriers were still charging absolutely stupid prices for a package of like 200 texts and per text after, and receiving also counted towards that.
Apple says "hey we have the internet on this thing, let's make it a feature that when you send to other iPhone users it doesn't count against your text package" and then built a "modern" text platform. E2E, rich image/video support, the stuff you mention, etc. They made it so that you didn't have to worry about whether your friend was on iPhone, you could send a message to their number and Apple would figure it out. The green bubble thing initially was just "btw you're paying for this one." The reason I say they kinda backed into the lock-in thing is because obviously the idea here was "buy an iPhone and stop paying stupid carrier fees" which is obviously a lock-in strategy, but that aspect of the carrier plans basically collapsed as Facebook released Messenger that same year, so it quickly became "unlimited for $20" and then just "it's all in your plan (which we're just being less obvious bout gouging you on.)"
The green bubble thing sticks around though in the US largely because the US is one of the few places where iMessage becomes a major player in the messaging space, probably because the US market sees a larger share of iPhone sales due to economics and Apple not really having a low-end strategy except "buy an older iPhone." Other places go to WhatsApp or WeChat or whatever, but Apple continues to grow (I think around 55% in the US?) and now it's an annoyance for everyone. I don't think I've ever really seen anyone care about the green bubble other than "shit now I have to figure out how to send them this video of the whatever." At least for younger generations, this just means that the primary text method becomes Snap (me and my wife are about the only people my kids open the Messages app instead of Snap for) while the olds all use Facebook Messenger, and those who refuse just spend more of their day annoyed.
Anyway, it was a nice convenience when it launched. Personally, I think Apple has little reason to develop and process messaging for free for Android and businesses don't do things to be nice, but they're all about service revenue, so I think they should release an Android app, and make it easy to buy stickers and shit like that, send money via Apple Pay, etc. iMessage has already subtly shifted that direction on iPhone and I know at least in my friend/family group we pass money around like that all the time, and this becomes another thing that's sort of annoying when we hang out with someone who isn't on iOS. also, probably obviously, but it's not even like "oh we're hanging out with the poor friend on Android" or anything, he is also holding a $900-$1200 phone, so the lack of interop on these types of things that should probably just be a protocol is annoying af.