With firefox 3.5 html5 was introduced. Since 4.0 both ogg/theora and webm/vp8 video formats are supported.
As of firefox 14, gstreamer support can be enabled with --enable-gstreamer. If the required gstreamer codecs are installed then firefox can play H.264 in a <video> tag.
=== Open questions ===
1. Note that the Windows build still only supports patent free codecs.
2. Note that youtube already supports webm/vp8 (altough still not for all videos), while wikipedia supports ogg/theora. Which important sites require other codecs?
3. Chrome supports H.264, but promised to drop support for it ( http://blog.chromium.org/2011/01/html-video-codec-support-in-chrome.html ).
4. How stable that code is? Which regression could introduce?
5. Given the Ubuntu commitment to free software, do we really want to enable support for other codecs other than the officially supported free ones?