I think Flash is going to suffer because a lot of people just don't want to develop with it any more, for all sorts of reasons, not least the ones that have been popping up on HN lately (Apple products like the iPhone, non-OSS, etc.) There are tons of developers who would jump at the chance to switch to an alternative, and there are probably lots of developers who are reluctant to learn Flash for these reasons, but still want to be able to program nicely performing animations, interfaces and games.

I fall into the latter category: Flash programming appeals to me because of what you can do with it, but I'm not interested in making a substantial investment of time into a platform that I would rather see replaced by OSS alternatives. (For similar reasons, I'm not planning on learning Obj-C to develop for the iPhone - I'd prefer to get good at developing mobile web applications using web technologies).

The gradual shift in developer attention away from Flash over to alternatives is going to chip away at Flash over time, but I agree that it's going to take quite a long time.

Ultimately I still find it hard to believe how far behind web browsers are when it comes to graphics. The stuff I was running on my 386 back in the day pretty much destroys anything you can do in a web browser. It's kind of sad when everybody gets super pumped that you can run a tiny, glitchy version of Wolfenstein 3D in a web browser. It's great that it runs. But shouldn't we be at full-screen Quake levels by now?