For those wondering when that will take place, Google has since announced on its website that this merging of features will be taking place later this year. According to Google, the classic version of Hangouts will be officially retired in October 2019 and all remaining users will be transitioned to Chat.
However this won’t just happen suddenly as Google will give admins and users plenty of time to get used to the changes. Google’s timeline states that in April, there will be changes that will require administrator action, and between April and September 2019, features from classic Hangouts will be brought over onto Chat, and it is only in October 2019 that the retiring process will begin.
However it should be noted that this will impact users of Google’s G Suite (basically enterprise users). As for “regular” users who are still using Hangouts, this transition will happen but at a later date following the migration of G Suite users. There is no word on when this is expected to take place, but Google states that they will share these details later on.