Earlier quoted context omitted.
The iPhone has supported YouTube through a native application since it launched . It does this by streaming the MPEG-4 video directly instead of using Flash as a player. Every other video site does this as well, and they don't even need a native app or any server-side weirdness. The only reason we don't do this on the desktop is inertia. the majority of online display advertising Which no consumer gives a flying fuck…
Nobody in their right mind uses Flash for anything important. iPhone has, but I'd wager the vast majority of YouTube users watch videos in their browsers. the majority of online display advertising Advertisers are the revenue source for innumerable online sites; they like Flash so it is important. Re: uploaders... A native application...does the same thing. Sure, but again, I'd wager that most people use the on-site…
Yes, but what are they actually doing? They're streaming the exact same h.264 video, except using the Flash plugin as a (buggy, inefficient) decoder.
they like Flash so it is important.
Not to users. Users are the ones who actually buy and use the devices that end up viewing the ads. No user buys a device for a better ad experience. That's nonsense.
nearly 100% market penetration
This is not going to hold true as more people browse the web on devices that lack Flash. Such devices may not be the sole or even primary way of browsing the web for some time, but in terms of total volume of web usage, it is already significant, and will only grow. It will make less and less sense to target a web platform that can't be reached every way that people use the web.