But there's a more fundamental issue: Currently, in all censored countries, there is at least one way to receive prohibited text messages more efficiently (and with greater deniability) than with Collage. So Collage may work perfectly, but even when it gets released, I'd be very surprised to see large numbers of people using it unless all the simpler alternatives get blocked.
Most tools that people use to circumvent Internet censorship, are not "deniable" in the sense described above. If you visit a proxy site like VTunnel, any censor who is monitoring your Internet connection can see that you connected to a known proxy site. If you connect to the proxy site using "https://" instead of "http://", then a censor eavesdropping on your connection, won't be able to tell what you looked at through the proxy site (unless they confiscate your computer and look through your browser history), but they'll still be able to tell that you visited a proxy site. Similarly, if you use a tool like UltraSurf or Tor, those tools can circumvent the censor's filters by re-routing your Internet connection through a server outside the censored country -- but a censor monitoring your traffic, can still see that you connected to an UltraSurf or Tor server outside the country, even if they can't tell what Web sites you were visiting.
But if all you want is to receive short text messages, then there are many options that are completely "deniable." The simplest is probably to use Gmail and to choose the option to always read messages over https://. (If you sign in to Gmail, under "Settings" you can choose between "Always use https" and "Don't always use https".) If you read your inbox contents using https, then a censor eavesdropping on your connection can't see anything at all -- not the contents of messages that people send you, not the email addresses of people who are writing to you, not even the username that you use to sign in to read your Gmail messages. This gives you more or less perfectly deniability. As long as many Gmail users are using Gmail over https://, then doing this by itself would not attract undue attention from censors monitoring your Internet traffic. Using Gmail, you could also exchange higher-bandwidth content like images and video (up to Gmail's attachment size limit, currently 25 megabytes), something not possible with Collage.
Of course, if you remember the case in which Yahoo turned over information about one of its Chinese account-holders to the Chinese government (who subsequently arrested the user and sentenced them to 10 years in prison), you may be wary of trusting any Western corporation with your privacy. But in this case, you wouldn't have to. Because even if the Chinese government found out that some Gmail users were using Gmail to receive anti-government messages from the U.S., the censors wouldn't be able to eavesdrop on https-protected connections to find out which users were receiving the messages or what they said, so there would be no information for them to demand that Google turn over to them.
Or if you want to exchange encrypted text messages in real time, you can use any instant messaging client that supports encryption. Whether or not this is "deniable", in the sense of not attracting undue attention for "suspicious activity", depends on what proportion of other users are using the chat program in encrypted mode as well. The current version of AOL Instant Messenger, for example, apparently encrypts all instant messages by default. (Although you should take care to understand exactly what is "encrypted" when using an instant messaging client. In my experiments, when using AOL Instant Messenger, the contents of messages were encrypted, but the specific screen names that you're sending and receiving messages from, are not. In other words, a censor eavesdropping on your traffic, can see which screen names you exchanged messages with, but not the message contents. So if there were an AOL user account in a non-censored country that was a dummy account used primarily for passing banned information to users in censored countries, then if the censors ever found out about that account, they could flag and investigate any user in their country who exchanged messages with that screen name.)
The bottom line is that as long as at least one of these alternatives remains unblocked in your country, they would serve as an easier way to achieve the same goals that Collage achieves. They're generally faster, more convenient, and most of the time, more "deniable", in the sense that the traffic they generate won't look as suspicious as, say, browsing a Flickr feed that later becomes widely known as source of banned encoded messages. Collage does demonstrate that an interesting idea can be reduced to practice, and is robust in the sense that the general scheme cannot be blocked unless a regime blocks access to every site hosting user-submitted content. But there doesn't seem to be a compelling reason to use it unless and until all of the simpler methods get blocked.
I write all of this as someone who also wrote a program a few years ago that was meant to serve as a more robust back-up, in case a more popular method of circumventing censorship ever got shut down by the censors. In my case, I thought that most censoring regimes would start blocking all popular Web proxy sites, so I wrote an install script called "Circumventor" that would let you set up a Web server and James Marshall's CGIProxy script on your home computer, turning it into a mini-Web-proxy site. I assumed that eventually, most people in censored countries would have to rely on someone in a non-censored country to set up a private Web proxy like this and e-mail them the URL, once China and Iran got their act together and started blocking most publicly known Web proxy sites. But that never happened, partly because Web proxy sites are now springing up faster than most censors' databases can keep up with. So the web proxy install script fell by the wayside -- but that's good news, because it means that nobody really needed it, since the simpler, more straightforward methods continued to work. Why pester your cousin in the U.S. to set up a Web proxy for you, when most Web proxies you can find in Google are not even blocked yet?
And so it goes for Collage. It sounds like a perfectly fine idea, and it will be great news all around if nobody ever actually has to use it, because the censors never get around to blocking all of the simpler alternatives.