Adobe's Mike Chambers announced the news on his blog. Chambers believes that while Apple will most likely selectively enforce the new terms, Apple will enforce them against applications for the iPhone created with Flash CS5. "Developers should be prepared for Apple to remove existing content and applications (100+ on the store today) created with Flash CS5 from the iTunes store," Chambers writes, "We will still be shipping the ability to target the iPhone and iPad in Flash CS5. However, we are not currently planning any additional investments in that feature."
"As developers for the iPhone have learned, if you want to develop for the iPhone you have to be prepared for Apple to reject or restrict your development at anytime, and for seemingly any reason," Chambers continues, "The primary goal of Flash has always been to enable cross browser, platform and device development. The cool web game that you build can easily be targeted and deployed to multiple platforms and devices. However, this is the exact opposite of what Apple wants. They want to tie developers down to their platform, and restrict their options to make it difficult for developers to target other platforms."
Of course, Apple is lying here by claiming H264 is an open standard - it's patented up the wazzoo with complicated and restrictive licensing agreements. These patents and licensing agreements are overseen by an organisation which has threatened to sue ordinary users - an organisation Apple and Microsoft have stakes in.
It's understandable Adobe ceases development of these features, since they're pretty much useless now. Maybe they can spend the energy on actually making Flash bearable on Linux and Mac OS X.