it's what i've said from the beginning, adobe got started too late. 18 months ago they might have had a shot, but now with 100 million iOS devices, a larger number of blackberries and a rapidly increasing android market (where only a small percentage are capable of flash playback) the critical mass is behind non-flash mobile devices. even if flash worked flawlessly it would have a massive game of catch up to play.
Developer wise, it is HTML5 which has to play catch up. And lack of developers quite easily might become its Achilles heel.
Either within 1-2 years somebody releases decent HTML5 authoring/programming tool which is as good as competing Adobe Flash development tools. Or HTML-only/Flash-less web would remain a pipe dream, as surely CPU speed/RAM size would go up and Adobe would fix most of the show stopper bugs.
And after the latter it is a win-win for the industry: more of the more expensive phones with more of the more h/w demanding software. And there be upgrade carousel for everybody! Well, PC industry went through it already - now it comes to mobiles too.