This is shaping up to be a big big issue. There are reasons for H.264 (it's *the* professional standard) and there are reasons against H.264 (it requires royalty payments). Firefox/Mozilla have said they can't support H.264 because of the latter and they don't want to devolve it to the OS. Meanwhile, Apple and Google have shown their hand, so it will be interesting to see which way Microsoft jumps.
Wade.