Next move, suddenly youtube stops encoding in h.264 and youtube won't be able to be played on the iPad.
And Android tablets look a LOT better.
And Android tablets look a LOT better.
I actually think Apple wins it as someone creates iTube. People will switch browsers. They won't give up their iPad (at least not until there are some better Android browsers on the market).
Android doesn't even do hardware-accelerated graphics, let alone video decoding.