Given the "enemy of my enemy is my friend" (think the "M" word) relationship of Apple and YouTube-owner Google, its not even the mildest of surprises that iPhone will be YouTube-compliant.
Today's announcement of same refers to a new Apple-designed application on iPhone will wirelessly stream YouTube’s content to iPhone over Wi-Fi or EDGE networks and play it on iPhone’s 3.5 inch display.
"iPhone delivers the best YouTube mobile experience by far. "Now users can enjoy YouTube wherever they are—on their iPhone, on their Mac or on a widescreen TV in their living room with Apple TV.”
As to the stuff under the hood that is supposed to make YouTube and iPhone rock, YouTube is doing its part by encoding videos in the H.264 format. YouTube and Apple both say today that more 10,000 videos will be available on June 29, and YouTube will be adding more each week until their full catalog of videos is available in the H.264 format.
Full H.264 is expected to go down this fall.