In what might end up being a perfect example of Microsoft’s quiet dominance in the web arena, the company is now publicly stating that the forthcoming Internet Explorer 9 will only support H.264 as the codec of choice for HTML5 video.

A post on IEBlog by Dean Hachamovitch, General Manager for the Internet Explorer team lays out the reasons, some of which echo comments made by other industry players like Apple:

H.264 is an industry standard, with broad and strong hardware support. Because of this standardization, you can easily take what you record on a typical consumer video camera, put it on the web, and have it play in a web browser on any operating system or device with H.264 support (e.g. a PC with Windows 7).

Microsoft has already built support for H.264 into devices like the Zune and upcoming hardware built for Windows Phone 7 is all but assured to follow the same path. Windows 7 similarly includes built-in support for H.264, which Microsoft says developers can “rely on … without paying any additional royalty.”

Hachamovitch also states in no uncertain terms that “The future of the web is HTML5.”, and takes the opportunity to cite reliability, security and performance as common problems with Flash (which is mentioned by name), but the company does note that “Despite these issues, Flash remains an important part of delivering a good consumer experience on today‚Äôs web.”.

In what is clearly a shot aimed at Theora (which is not mentioned by name), Microsoft cites the difference between “availability of source code and the ownership of the intellectual property in that available source code” as a primary reason they decided to simply go with H.264. The company states that the licensing situation around H.264 is clear, while “the rights to other codecs are often less clear”.

So is that it? Is open H.264 video ready to take over the internet and push Flash into irrelevance? Not quite, the codec war may be over, but the browser war is not.

The wild card in this whole situation is Mozilla, which has a substantial share of the browser market and significant influence over users and developers alike. So far, Mozilla has refused to implement H.264 for both practical and principled reasons. It would be impossible for them to redistribute the code to the millions of Linux, BSD and other users without forming a long chain of patent license violations. They also object to the uncertainty that comes with H.264 licensing costs, which may increase in the future, and which appear to cover every step of the video distribution process, from encoding in production, to transmission, to decoding at the viewers computer.

Mozilla has thrown its weight behind Theora as an alternative to H.264, bundling it with all new copies of Firefox and making the case for completely open web video from end to end. However, with Microsoft’s full support for H.264 in Internet Explorer 9, it doesn’t look like Mozilla’s Theora support is going to have much effect. Mozilla may be forced into a situation where the rest of the web goes with H.264 while Firefox users are still served Flash, which is probably going to remain ubiquitous for years on the desktop.

Of course, things may change in the next year, but right now it seems like the codec war is over, H.264 has won.