For the non-technical person reading this post, rich media files are typically read or decoded by an external application that’s associated with your brower using a codec. With HTML5, the codec is directly embedded into the browser. This is smart approach because recent tests of HTML5 demonstrate that video playback requires fewer CPU cycles. And this translates to less expensive, longer-lasting netbooks and mobile devices since they require cheaper CPU’s or chips that consume less battery power. The downsides to this approach are a lack of support or even absence of a standard. NOTE: Internet Explorer, the most dominant browser, provided hints of HTML5/video support in a recent demo of IE9.

The reasons behind media killing Flash are based on the most recent developments in the advertising world. Several notable newspapers and magazines, including the Wall Street Journal, GQ and Men’s Health have planned to be available as digital editions when the device hits store shelves on April 3 (some are opting for special apps!). Interestingly, many of these magazines are reporting that advertisements for the premier issue have already sold out on the iPad. This is a first for traditional media to sell out of ads, who in 2009 lost 25% of page ads.

Flash is used primarily for advertising. Based on a survey by Mochi Media of 1,100 Flash developers, the majority of respondents, or 58 percent, indicated that they have advertisements within their Flash game. In fact, 2009 rich media ad spend in the US was at $2B – $3B dollars and trends indicate that rich media ad spending in 2010 will grow at a healthy clip of 5.5%. With that kind of budget, it is advertising that has the necessary financial backing to make an impact. Money talk, right?!

We’re already seeing some initial indication of what the future holds. On the video front, Brightcove released a solution this week to its Fortune 500 clients that allows for seamlessly conversion of Flash video to HTML5. Additionally, rich media ad platform Greystripe enables clients to convert existing Flash ads into the HTML5 format.

In my mind, this is the tip of the iceberg. As advertising agencies and companies turn to these offerings, Flash will become less and less necessary, and relevant.

And this morning I found out my thought on user behavior measurement in Flash is one step closer to becoming a reality: Adobe just announced the availability of a Flash distribution service via a partnership with Gigya. As part of this agreement, Flash developers now can easily embed social networking sharing capabilities and user tracking into Flash applications, thus widening audience reach.

As part of the announcement, Adobe has unveiled a platform called Distribution Manager that allows developers to tag their application and track users. With Distribution Manager, Flash developers can review reports on user engagement by campaigns, a feature that is already found in Omniture. While Adobe has not specified that Omniture is used behind the scenes to power this solution, there’s nothing that’s stopping Adobe from leveraging Omniture’s platform in delivering these capabilities. At the very least, Omniture can leverage the insights from Adobe’s platform to fine tune their social media offering, which may include reporting on social behaviors such as emails sent from the application, stickiness or viral grabs.

This strategy clearly sets up Adobe and Omniture to become more relevant in the market place.