It's actually pretty simple when you think about it: flashes bring about too many downsides. They will load with the page, regardless of whether people want to see them. And then there's room for people to abuse the freedom of embed tags by linking to malicious movies outside of newgrounds, or write pieces of code that'll fuck with the browser. Streaming isn't prone to such abuse.
TheMajormel
ya know you bring up a good point about the embedded .swf files. It'd be pretty fucking nice to have those
Psychopath
It'd fit right on in with Tom's omni-content concept where the userpage is just a Twitter feed for content and activity, at least it would as a placeholder or prototype to what I think he's gonna do.