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Indeed, this is long overdue and I've been making this argument for years. Adobe has already lost a lot by keeping Flash Player closed and they only stand to lose more and more. This decision, for instance, will only promote HTML 5 adoption in lieu of Flash farther and farther. Adobe can still matter if they open-source Flash Player right now, but as you noted, the sweet spot is closing rapidly.

The fact of the matter is that if Flash had opened itself up earlier, there wouldn't even be an HTML 5 Canvas/WebGL as we know it, people just would have used and extended Flash and Adobe would still be making bank on their commercial IDE for the environment. Now Adobe's dominance is threatened and Flash is universally despised.

Adobe is obviously terrible at maintaining the runtime so I think the only logical explanation for their lack of OSS Flash Player is that they have some very prehistoric business guys somewhere along the way that don't understand open-source at all and choke this off in terror every time it gets mentioned.

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