Thanks to the ACID3 test, all modern browsers support animation in SVG and svg in an img tag. Which means you can do extremely small vector based animations, or write an encoder that embeds jpegs and animates them like a film strip. You can have alpha transparency using a mask image via SVG filters. You can get really fancy and animate with deltas. The efficiency you lose by the base64 encoding is regained by gzipping.
Actually SMIL (the declarative way to do animation with SVG, for those who don't know) has always been controversial (as far as I know, IE never passed that part of Acid3), is more or less on the chopping block as far as browsers are concerned, wasn't extensively tested in the original Acid3, and, in any case, was removed from Acid3 as of 2011[1]
It was removed from Acid3 (or at least made optional), letting IE pass the test without implementing it. Furthermore SMIL is fairly complex, performs worse than script animation in today's browsers and (iirc) doesn't play well with CSS animation. I think I've read on the mailing list that there is effort done to harmonise those two in the future.
To review, it would seem that while you have a blog post from ian hickson making a passive reference to deprecating smil. Indeed he followed up by removing the feature from the ACID3 test. But the damage was already done:
evidence of actual standards activity and implementations from as recently as June 2014 show instead an active merging of css animation with svg animation into a single consistent model called "web animation" [1]
the implementation of this merging effort in chrome's blink rendering engine [2], and a rationalisation for this webanimation effort that promotes not a removal of the svg animation features (which are already implemented in everything but IE), but an expansion of their powers, being advocated by both google and mozilla [3]
Just because IE is lagging behind doesn't mean this feature is cut. Just because Ian Hickson says the feature is deprecated doesn't mean that it is, or that browser devs will follow whatever he says.
What it does mean though, is they are attempting to cut the feature's dependence on "SMIL", while retaining the currently implemented features. so I think that whatever works in browsers now, you can more or less rely on that working in future browsers as well. So yes, my suggestion is still useful and it's still awesome. And if you use css animations inside the svg (which totally works) instead of svg-smil animations, you can even get it working in IE10
