If not Flash, then HTML5
Although it is uses more processor and memory resources, the newer smart phones have 1GB+ GHz processors and plenty of memory and should be able to handle HTML5 without issues, other than multitasking numerous apps running the HTML5 plug in simultaneously.
I expectto come out with an iPhone5 with enough processor speed and memory that can easily handle HTML 5
Or at least let's hope so.
Well...not sure of what level of HTML5 you are talking about, but current MObile Safari support html5, I played PAcman coded on HTML5