basically, this question has been around already.
The answer in short: no, HTML5 will not replace anything. HTML5 will however offer a standard for features currently only available through plugins. Once HTML5 is released, which is scheduled for 2022, it will be a great thing. Still, even by then, if IE survives, I doubt it's support will be outstanding.
There has been a very similar question to which I provided a rather lengthy but detailed answer: http://stackoverflow.com/questions/2643407/should-web-developers-learn-flash/2644910#2644910
My personal opinion about anyone who thinks HTML5 will replace 3rd party plugins is, that they lack basic understanding of HTML5's role or sufficient knowledge about any plugin and have little if any grasp of how the web evolves.
Yes, the day HTML5 is sufficiently spread for large companies to rely on it, many of them will be able to replace 3rd party plugins within their web applications. However, as pointed out in my other post, the web is constantly evolving. HTML5 does not provide new features, that weren't available using plugins. And HTML5 does not provide all features currently available using plugins. New types of apps, services and content distribution mechanisms will arise. Also, as long as JavaScript stays fully dynamic, JS runtimes will never be able to provide the same speed as runtimes designed to run bytecode generated from statically typed languages.
Personally, for the client side, I basically only target the Flash Player, because to me it is the most convenient platform. I am not afraid that HTML5 might kill flash, for a simple reason:
Until HTML5 is really usable and largely supported through sufficient user adaptation, it will take several years. In the same time, all major plugins will continue to evolve, as well as their eco-system, including developement tools, cross-compilers and compatibility layers.
Today, you already need no knowledge of HTML, CSS and sometimes even JavaScript to create webapps, using GWT, qooxdoo or other tools.
HTML+CSS+JS represents nothing more than a platform that more and more languages are able to target. Using reasonable amounts of abstraction, one will sooner or later be able to develop apps in a totally platform agnostic manner, causing virtually no overhead for the lion's share of all apps: GUI (including localization, validation etc.) and application logics.
In the end, there's no reason to get excited. Currently, both Flash and Silverlight exceed HTML+JavaScript implementations in speed and features exposed through the available API. That is, why people use it. Altough unlikely, some day they may become obsolete. In this bright, bright future, far, far away, I will be happy to compile my sources to run in a JavaScript interpreter rather than on AVM2.
On a vaguely related note: check out haXe.
greetz
back2dos