I welcome this move, despite the possibility of some fallout from the change. It'll be painful, but even as someone who once made a living writing ActionScript, I have to say that Flash is sufficiently annoying and insecure that it really needs to be phased out.

In the short term, this will probably cause some breakage in certain sites that try to use Flash "transparently" and "unobtrusively" for things like LSOs, drag-and-drop, clipboard access, or cross-domain XHR. These are already problematic with Flashblock installed though -- Pandora, for instance, refuses to load and there is nothing available to click-to-play since that particular Flash object is hidden.

Hopefully this will light a fire under those sites and get them to update to the appropriate HTML5 methods of doing these things (local storage, WebSockets, etc.), just like how Java applets that were used for such things have been largely phased out. Until then, however, I wouldn't be surprised if some of them simply inform you not to use Firefox to visit.