This would be great for me as Flash usually uses around 90%+ of one core on my box to decode video while other media players (QuickTime, VLC) use a third of that. This is going to be hard for a lot of handhelds and hopefully that will lead HTML5 video to offer a much better experience on mobile devices.
Adobe knows that if they don't get Flash out for mobile platforms, Flash is going to be left out of the next push on the web in favor of Ajax and HTML5. So, while Adobe does dominate a lot of things right now, their position is tenuous.