Published at LXer:

Google will take a swashbuckling step towards license-free web video playback next month when it open sources the leading video codec from a company it just acquired for $124.6 million, according to a report citing multiple people familiar with the matter. NewTeeVee reports that Mountain View will open source On2's VP8 codec at its Google I/O developers conference in San Francisco in mid-May. The publication also says that Google will roll the codec into its Chrome browser, and that Mozilla will do the same with Firefox.

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Actually this as at the request of the FSF, I'm glad Google accepted:
http://en.wikipedia.org/wiki/VP8
What I don't know is the quality of this codec, I've never used it. I hope they include it in ffmpeg so I can test it at some point.

I agree, it is a very good thing that Google is doing. Unless something not dependent on h.264 cropped up, HTML5 was looking to be a real problem for browsers like Firefox. Of course if this codec is crap, HTML5 may still be a problem.