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This opens up a whole new area of cross-browser incompatibility. There are many good points here, and like a Martial Arts fighting style, each point has its thrust, and each can be defended; but each can be defeated with the proper moves.
Regarding the Internet being more semantic, it may be important to you.
As we learned at the most recent Apple WWDC, "browser plugins" (read: Flash) account for the majority of of Mac OS X (and by "majority", I mean some absurdly high number like 80% or something, can't remember the exact figure offhand).
As those who say Flash is not indexable, check out what Google has been doing lately with indexing Flash content thanks to a headless player Adobe has supplied.
So if you do a google search for FLV files, you can see that Google already indexes Flash video files.(EDIT: I replaced the details with a link to SU, which gives some more insight; some of the comments below will only make sense with respect to a previous revision.) For me, it'd be very nice to have the computer built-in or another third party player play the video much more efficient than Flash can do.