See webmonkey and The Register for details.
The open sourcing aspect was long expected, but by tying in Adobe Google seems to me to have made a typically smart end-run around Apple (and Microsoft, but it's really Apple whose face we're loving to punch, isn't it guys?).
So Google will update YouTube and suddenly half the video on the web will be in the VP8 format, and Adobe will update Flash and suddenly 90% of all browsers will be able to view it. Since it's all open source, the rest of the web will follow in dribs and drabs.
Who then will need H.264? Only Apple and its walled garden of iPhones, iPads and iDontPlayVP8s I guess. That garden's looking a little droopier than it did a moment ago, and Apple could even end up having to pay publishers to supply content in H.264, ouch!
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