SBV is understood mainly by YouTube and a few caption tools. Plain text opens on every device and is easy to search or paste elsewhere. SBV is at home in uploading and downloading YouTube captions; TXT is the usual choice for notes, logs and text that must be read by anything.
The text is read as UTF-8 or UTF-16, whichever the file is. An older file in another code page is read using the charset it declares, or as Windows-1252 if it declares none, so accented letters in an unlabelled legacy file can come out wrong. A file that is not text, such as the picture-based subtitles of a DVD, is refused instead of being converted to nonsense. The result is a transcript with one cue per line, without times; a cue's own line breaks become spaces.