A journey of a thousand miles will start with a single step. That's how Google (Nasdaq: GOOG ) is changing the Internet as we know it right now: baby steps.
Starting this week, the eyeball magnet known as YouTube has a new way of showing you videos: HTML5. That's the next-generation standards specification for the code that makes up a website, and it comes with new features like simple video support. Using HTML5 code means that your Apple (Nasdaq: AAPL ) iPhone can show YouTube videos right in the built-in Safari browser instead of leaning on third-party applications.
Working around the need for Adobe (Nasdaq: ADBE ) Flash code should also reduce the number of browser crashes you'll see when watching videos in Google's Chrome browser, Apple's Safari, and many others. In general, HTML5 support in YouTube is cause for cheer in geek-land (where I have proudly claimed a sizable plot of real estate practically since birth).
But it could be the beginning of the end for Adobe's hitherto dominant media platform. Microsoft (Nasdaq: MSFT ) couldn't dent the Flash video solution with its Silverlight product, other than making a convert out of Netflix (Nasdaq: NFLX ) . But HTML5 video support is included in every major browser on the market today except Microsoft's Internet Explorer. That's without installing any third-party plug-ins that are prone to crashes and cross-platform compatibility problems, which means a nicer user experience all around.
HTML5 is still in early draft stages, but it could become a semi-official recommendation from Internet standards body the World Wide Web Consortium as soon as 2012. Other than fancy audio and video player features, the new standards also provide all-new features like local data storage (handy for mobile devices and email applications, for example) and geolocation (again, great for mobile browsers like the one on your phone). Also, you know those addictive little games you see all over Facebook? The HTML5 Canvas code may soon replace Flash in all of those, too.
When every browser can play video without Flash, Adobe will lose much of the benefit from buying Flash developer Macromedia for $3.5 billion in freshly issued stock nearly five years ago. Google isn't out to kill Adobe, but collateral damage is to be expected in any revolution.
Would you buy, sell, or hold Adobe stock without Flash? Scoot on over to CAPS and rate Adobe accordingly.