The VHS was a technology ageing really badly even during its time mostly because there were new technology that were undeniably better hence why they caught on fast (CDs). There is no technology "undeniably better" that would require the 3.5mm to go. The 3.5 works amazingly and the new stuff...
Long press the menu button in the messaging app to make the settings appear. Scroll down and you'll see the setting named GSM Alphabet. Disable it and try to text your friend again.
I'm not sure if anybody is having issues with this week's release on the Note 4, maybe I'll just skip this one just in case. Though the apparent issue is Google play and afaik is Android 7 related so I should be fine.