Physical tokens are not for everyone. As someone who is always on the move and works in industrial environments regularly, it is not feasible for me carry around another usb stick everywhere I go. I would hate to be locked out of my account for a few days simply because I lost the physical token. On the other hand, I am never without my phone, so sms notifications work great for me. I don't see any other exchange providing that kind of service.
Good point, I think the vast majority of people the token is best for but the phone service for customers like you who do need it is a great move.