I’ve had a bit more time to digest this announcement, churn it over in my head, etc. I wanted to break down just why it’s important:

1) Adobe kicks On2 to the curb. This is huge for anyone who has tried to deal with On2 in the past – either to get presales information, or to get support for a product. The attitude has always been “Hey, Adobe uses us, so you have to too, deal with it sucker.” No more!

2) Open Format. FLV was never an archive-friendly format, because it depended on a proprietary decoder. You wouldn’t encode the Zapruder film in FLV and hope to be able to look for the second gunman in 50 years, because there wouldn’t be a way to decode it. H264 is an open, published specification, (not open source mind you, but reference decoders exist) which means you can safely encode to it and expect to decode it down the line.

3) Single Format. One video file for your web embed, your podcast, your IPTV deliver and your archive. Nice.

Frankly, I think this is good for just about everyone except On2. Folks like Apple are no longer shut out of the flash video delivery world, Adobe doesn’t have to worry about codec development, and everyone benefits from the superior quality of H264.

Awesome to the max.