There's no one true replacement for Flash, it's just that Flash is getting replaced by a number of emerging, superior technologies. Of course, Adobe being dumbfuck Adobe, they're clinging to their old technology instead of getting their foot in and providing tools for the new technologies. Because they're dumb.
But basically, Flash has several main purposes that are being replaced:
Video --> h.264 encoded video embedded in HTML5 pages. The huge win here, for consumers, is that the codec is easily hardware accelerated, which helps give you ridiculous battery life when watching hi-def video.
Games --> Native apps on phones that sit closer to the hardware, meaning they can take fuller advantage of the limited resources of a phone and can access the unique features of the hardware (cameras, GPS, compass, accelerometers, gyroscopes, blah blah)
Ads --> Interactive HTML/JavaScript/video. Not new tech, of course, but whatever. No one cares about ads.
Other bullshit --> Good riddance.
We're a full, what, four years into the smartphone revolution started by the iPhone? It took Adobe that long to get something running on a phone, and it's still a half-way, kind of broken implementation? Fuck 'em.
A lot of people assume that Apple hates Flash purely because they're huge assholes. Of course, this is a huge misrepresentation. Apple doesn't want Flash (or other development platforms) on the iPhone for several reasons, but all of them really just tie in to the main reason: Apple doesn't want to cede control of the impossibly lucrative iOS platform to shitheels like Adobe. And it's not because they're arbitrary turds, it's because they know from experience.
Way back in the 68k processor days, the main development tools/platform for Mac was owned by a company called Metrowerks. They basically owned the means of production for creating Mac programs. Fast forward a few years, and Apple/IBM/Motorola (IIRC) came up with the hot-shit PPC processor. Of course, to take advantage of the new processor, you had to re-tool and recompile your programs for the PPC. The problem was that Metrowerks dragged their asses in supporting PPC. Apple had this crazy hot new processor, but no one was taking advantage of it because no one (well, most people) couldn't compile their shit for the PPC. It was a huge fiasco.
So Apple doesn't want people developing on Flash because then that means whenever Apple comes up with crazy new technology, they don't have to wait for Adobe to get their sorry act together. It took Adobe 4 years to get a barely functioning version of Flash on a mobile device. I'm pretty sure Apple's glad they didn't wait.
