On desktops, falling back to flash for H.264 decoding is a pretty good strategy.

On mobiles, though, Google's change has a bigger effect. Flash is abysmal (if existent) on Android devices--and now there is no clear solution that doesn't involve serving multiple encodings.

Before this change, you could be comfortable that your H.264 HTML5 video would play on the majority of smartphones; the flash fallback was only necessary for desktop browsers.