Yes, alternative serial monitors can be used. The arduino connects with the computer using a virtual serial port over USB. This means any application on your computer can potentially connect with the Arduino. Not to mention the fact you can write your own programs which can talk to your project using the serial port.

I have personally used HTERM and it met all my needs. Many people have used the other listed applications with positive results.

There are some differences between third party tools and the Arduino serial monitor. Only the Arduino system resets the board. Also you must disconnect your external monitor/program from the serial port before uploading code using the IDE.