Adobe is a menber of WC3 standarts too, the problem whith flash is bad coders, flash is not only adds or video is a powerfull tool for professional animation and other areas, by example Foster´s Home for Imaginary Friends was make whith flash, anyway Adobe have plenty of options to deal whith the problem, they can low prices of flash developers kit, they had already 3d cpu acceleration on the way whith CS5 and touch capabilities are also on the way, they can offer discounts for partners on video sites, they can sue apple whith patents and in the worst case scenario of vp8, h264 open canvas eating away a huge percent of his marketshare 25 percent or more they can turn flash to open source flash under a GPL, LGPL, or BSD license and submit it later to W3C and focus on sale better creation and edition tools, or make a automatic tool that converts the old flash content into html5/open canvas files.
Apple not wants flash not for the possibble security issues whith the kernel, that´s a excuse, flash has problems of course but the most of it is by human error in the programming phase or a bad security approach, all this affair is because Apple do no want anyone else in their application store that can compete head to head in revenue. Adobe and Apple both have their responsabilities in this mess.

It's VP6 (and recently H264) that powers YouTube, not VP8.

apple is a member of mpegla/they get a small portion of licensing fees
no chance they will adopt vp8 and neither will microsoft

offtopic but apple and microsoft are closer than you think
no 3 way battle
its them vs google (us : )

Death to flash!!! whoo hooo!

Go Google, adding to the Open world

More amenable to his will?
Not if he doesn't 'own' it!

I do hope this is more than just a rumour but I would imagine Adobe MS and Apple will be starting a new 'Googles not playing fair' campaign long before it is FLOSS.

surely you mean the codec that powers skype

As a developer of code knows, importing new technology is not foolproof after reading a document. It needs further ongoing advice from the maker of the technology when the developers adopting it run into a question. This is critical, and I think any company or browser wanting t adopt this tech will think or have to think about the questions that will need to be answered so there is no bugs preventing implementation, especially since bugs increase cpu and ram usage and slow the sw performance. it will all depend on how easy google makes it for developers to implement I think.