While searching for difference between HTML4 and HTML5 I came across the point that :
HTML5 brings a whole new dimension to web world. It can embed video
The idea regarding the tag is that the browsers should have native support for it, without the use of any additional software. The standard is not yet ready, and one of the points not agreed upon is regarding what codecs to support. For more information you could have a look at the html5 video wiki page which includes a list of which browsers support what formats.
If you are planning on implementing the html5 video tag, you should provide backwards compatibility. One way is to use the VideoJS library, which will fall back to flash, if the browser doesn't support the video source.
Here is what you might want to see : 20 Examples of HTML5 Video Player with Source
VideoJS is an HTML5 Video Player, built with Javascript and CSS, with a fallback to a Flash video player for when the browser doesn't support HTML5 video.
The current HTML5 draft specification does not specify which video formats browsers should support in the video tag. User agents are free to support any video formats they feel are appropriate. In cases where decoders are not built into the browser, the format support will be dictated by the multimedia framework of the operating system.