The last couple of years has seen an explosion of the use of video on the Web. The catalyst for this has been Youtube. With a free Youtube account you can upload video from a wide variety of formats. Youtube converts the video to a flash file format for you, hosts your video, and promotes it. All for free.
I believe the key to the success of Youtube, and the key to the success of any implementation of video on the Web, is the Flash file format. Compared to the wide variety of media players, video file formats, and codecs you have to take into consideration when using any other implementation, Flash is as close to universally playable as you can get. No need to have different versions of each page for real player or quicktime or windows media player. No need to worry about the users patience in downloading a codec for your mp4 file format. Easy.
So if you are going to putting video on your Website, there’s no question in my mind, you have to go with Flash.