The reason why flash is not on the iPhone is because Flash is not designed for use on touch screen devices.
For example, most flash uses the onhover state for many things... there is no onhover for touch devices, things are either being touched or not. If you are hovering over (touching) something you can't see it.
The overall design and user experience of Flash on a touch screen doesn't work. Plus flash is a horrible horrible memory hog.
These are the main reasons Apple does do it. Plus... if you look at Safari statistical data... something like 80 - 90% of time, IIRC, Safari crashes is because of Flash.
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