Scoble has an interesting post asking Can Flash Be Saved? His central point is that developers will make use of whatever technologies that are widely available to their users which, of course, makes sense. He draws an analogy between the growth of the iPhone OS, which does not include Flash, and Firefox, which does not include Microsoft-centric technologies like ActiveX. Within the first years that Firefox began to steal share from Internet Explorer in the consumer market, developers changed the manner that they coded their sites by embracing Web Standards.
The interesting thing about that change was that Firefox’s growth was fairly slow outside of the developer community. Many developers loved Firefox, but it took a few years for the general public to get hip to the browser. I would have to say that the iPhone has far higher brand recognition and uptake. You could attribute this to Apple’s strong marketing machine.
Mobile web browsing is still a small market compared to desktop browsers. It’s a tiny, but growing market that can’t be ignored. I believe that in just a few years mobile Internet services (including networked apps) will be more important than the desktop Internet for communication, entertainment, and consuming information. Devices like the iPhone and iPad are driving this forward. Android is growing and finally seeing a wider number of devices offering Google’s mobile OS. BlackBerry is a widely used platform, but it doesn’t contribute much to mobile web usage (yet).
If these (iPhone and Android) operating systems become the leading platforms in the mobile space, developers will build sites and apps based on the technologies available across them, namely HTML5 support that is part of the WebKit engine. If Flash continues to be blockaded from the iPhone OS, developers will certainly look to other technologies to replace it.