While it appears that Apple may selectively enforce the terms, it
is our belief that Apple will enforce those terms as they apply to
content created with Flash CS5. Developers should be prepared for
Apple to remove existing content and applications (100+ on the
store today) created with Flash CS5 from the iTunes store.
We will still be shipping the ability to target the iPhone and
iPad in Flash CS5. However, we are not currently planning any
additional investments in that feature.
They’re resting their hopes for Flash as a mobile platform on Android.