As the iPhone nears release, Apple has unveiled another previously unannounced feature: a YouTube application that will download and play back YouTube videos directly on the iPhone. (Earlier, the company revealed that the iPhone would sport improved battery life and a glass - not plastic - screen; see "Apple Announces iPhone Changes," 2007-06-18.) Apple also released a promised update for the Apple TV that enables YouTube video playback (see "Apple TV Gains 160 GB Drive, YouTube Downloads," 2007-06-04).
YouTube (which is owned by Google) has been encoding its video library into H.264 format, so I'm assuming that the Apple TV and the iPhone are somehow tapping directly into the H.264 feeds, since normally YouTube delivers its content using Flash.
At one point, Apple's press release talks about H.264 video in the context of the iPhone's Wi-Fi capability, suggesting perhaps that YouTube downloads could be quite sizable. Using Wi-Fi, that's not a problem, but downloading over a cell data connection could be costly. Neither Apple nor AT&T have announced pricing for the iPhone's phone and data services.
The Apple TV 1.1 update also patches a potential security vulnerability in UPnP IGD (Internet Gateway Device Standardized Device Control Protocol) where a remote party could cause a denial-of-service attack. The update is available via the Apple TV itself, not as a standalone download. From the device's main screen, choose Settings, and then choose Update Software. It's unclear at this time whether other enhancements are included in the update.