[axod]

As far as I understand from the page:

You only need to include one format - h264. If you then view it with a browser that doesn't support VIDEO, or does support VIDEO but not h264 (firefox), it'll fallback to playing that h264 using flash (No flv required as far as I see).

However, you can also give firefox some love by adding an ogg version.

So IMHO, this is real tangible useful progress. It makes it easier for developers to use cool new HTML5 features without breaking old crappy browsers.