As I argued [1] several years ago when the FF+h264 drama was in full swing with Mozilla making their principled stand, and way too many people seemed to be hanging their hopes on Google granting the world a miracle with VP8/WebM. So while it seemed that many people got what they were hoping for, the problem was never truly solved.
Instead, the refusal to put h.263 into Firefox (even if done though some sort of proxy/external plugin that simply exported the problem to mplayer/gstreamer/whatever) didn't affect video at all (MPEG-LA still holds all kinds of patents). The real damage, though, was keeping Flash around. When presented with the compatibility mess that is the <video> tag, Flash was (and still is, most places) the obvious choice.
There's a time and a place for standing firm on your principles, but it's also important to pick your battles, and removing that bug-ridden binary blob from the browser would have been a huge win.
[ ok, rant/flame off. I'm not really angry, just bitter after dealing with this particular mess while watching an obvious solution wash away. Maybe building something in minecraft can counteract this particular Sisyphean mood... ]
[1] It was before I know about HN, unfortunately. Second two links are follow-ups attempting to explain the futility of fighting what had already been decided...
- http://slashdot.org/comments.pl?sid=1597850&cid=31643970
- http://slashdot.org/comments.pl?sid=1597850&cid=31644218
- http://slashdot.org/comments.pl?sid=1730576&cid=33009474