Ogg/Theora/Vorbis is royalty-free for all parties is the chain (the H.264 grace period for hosting H.264 ends at the end of 2015 and encoding and decoding are already subject to royalty)
Once fallback for IE is no longer necessary, will be easier than Flash
No need for the plug-in prison—browser vendors can fix their own bugs
Integrates with CSS effects
Integrates with SVG effects
Integrates with JavaScript
Can be ported to any platform without permission from Adobe
User can save the video to disk easily
Can be made work safely in syndication feeds (but software not ready yet)
Cons:
IE support for the video element has to wait until IE9; current IE-compatible Ogg fallback renderer relies on Java until the ActiveX solution or the Silverlight solution is finalized
Safari needs XiphQT to play Ogg, because Apple hasn't shipped Theora.
Royalty-encumbered format needed with the iPhone (but no worse than Flash)
Can't go full-screen in every desktop implementation shipping today