For those who haven't heard, WebM is Google's new media format that compresses video with the VP8 video codec and compresses audio with the Vorbis audio codec. It seems the H.264 codec just wasn't cutting it for Google as they aim to bring about an open, royalty-free file format that runs smoothly with HTML5.
Google appears certain that this format won't be going away any time soon as the new Android 2.3.3 update and later iterations will only support WebM. Perhaps, by forcing it on future OS it will ensure the longevity of the new codecs. The screenshot below shows the different video formats based on OS:
Since Chrome has already adopted WebM as its primary video format, this could just be one more step toward bring Chrome and Android together. It would make sense, after Eric Schmidt's announcement at Mobile World Congress stating these two platforms will merge in to one OS.
More information about WebM can be found on their about page along with a link for developers who may be interested in molding the new media format in to a widely used resource.