VP8 is now free under the WebM Project (announced at Google I/O last week), but if the quality is substandard, who cares? Well, it turns out that the quality isn't substandard, so that's not an issue, but neither is it twice the quality of H.264 at half the bandwidth. Streaming Media have compared footage encoded by both standards - and here's the results.
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pretty interesting article even though from what i can tell there is barely a difference but h.264 is still better.
Yeah there's not a noticeable difference at first look - it's only when you analyse the images that you really notice the downgraded quality in parts.