@Pherule: don't mix "open source" and "public domain" - one of the best H.264 codecs out there currently is called x264. It is open source, and can be downloaded in source form very easily. However, H.264 is a particular version of the MPEG-4 format: it includes stuff like lossless video coding and other advanced techniques which were absent from its predecessor, which was also called MPEG-4, but was covered by the H.263 specification... One of the most well-known implementations of H.263 is DivX. Since H.263 was not finalized by the time codecs started appearing, it was very hard to establish what patents was owned by whom, and as such projects such as XviD were pretty much left alone.
However, for H.264, several companies pooled their patents together and started charging fees for any kind of usage or even handling of H.264: they actually pooled their patents and THEN wrote the specification - and then started going aggressively after any usage of H.264 that didn't get them a dime.
Such as Internet streaming.
This didn't sit well with Youtube's owner Google, who was forced to pay MILLIONS each year for the right to encode, stream and display videos. And so, Google started pushing other, open-source and patent unencumbered formats like Theora (roughly equivalent to DivX5 in size to quality ratio) then VP8/WebM (roughly equivalent to H.264 when using one of the latter's poorest codecs, but quite a bit behind x264).
And suddenly, you could watch streamed H.264 videos for free - only browser makers had to pay for the patents. Microsoft didn't hesitate (they are part of the fund), Apple did like Microsoft, Google left WebM perish slowly and simply didn't provide their H.264 decoder with Chromium's (Chrome's really open source version) source code.
However, Firefox is COMPLETELY open source - they CANNOT pay for a license to the MPEG-LE group, because they don't know how many copies they distribute, and it goes against their policy. However, mobile phones and most desktop computers do implement a hardware decoder: as such, their owner already paid for the right to unpack and watch H.264 video, and the streaming itself is now irrevocably free. So, Firefox Mobile captures the H.264 flux, sends it untouched to the hardware decompressor, and gets back a non-H.264, uncompressed video stream. If the device has no H.264 decompression capabilities though, you're out of luck.