To clarify, Flash isn't going to just disappear from the Market, and in fact Adobe will continue to provide security patches. However, since they won't adapt it to new browser, OS, and device configurations, there is a chance it will stop working at some point in the future or won't work at all on newer devices.
According to ZDNet, Adobe is throwing in the towel on Flash for all mobile platforms (Android included), and will encourage developers to use AIR and HTML5 in the future as alternatives to the company's iconic web plugin. This follows hot on the heels of news that Adobe is cutting 750 jobs at its North American and European arms. The announcement regarding Flash is expected to come at a financial analyst meeting tomorrow.
Flash for Android has a storied history, and often served as the cornerstone for arguments that only Android allows mobile users to experience the "full" web on their smartphone and tablet devices. While Adobe will continue providing security updates to the Flash for Android platform, its development as a product will effectively end.
The lackluster performance of Flash in mobile (and, let's face it, any) applications and the increasing hype around HTML5, as well as Adobe's financial circumstances, are likely to blame.
The supposed announcement was leaked to ZDNet, below:
Our future work with Flash on mobile devices will be focused on enabling Flash developers to package native apps with Adobe AIR for all the major app stores. We will no longer adapt Flash Player for mobile devices to new browser, OS version or device configurations. Some of our source code licensees may opt to continue working on and releasing their own implementations. We will continue to support the current Android and PlayBook configurations with critical bug fixes and security updates.