Why is this important? YouTube switched to adaptive streams in the Flash player and now does the same thing for the HTML5 player, but this requires Media Source Extensions. The adaptive DASH player uses separate chunked streams for audio and video, so that YouTube can switch the stream to a lower or higher bit rate, depending on the network bandwidth.
A few days ago, YouTube removed the non-DASH streams for 480p and 1080p. This means that you'll no longer be able to watch 1080p videos in YouTube's HTML5 player if you use Firefox or Safari. Here's an example of video that includes the 480p and 1080p options in the Flash player and the DASH HTML5 player, but not the regular HTML5 player.
Maybe this was one of the reasons why YouTube decided to make the video quality drop-down less visible.
Update: Mozilla plans to add support for Media Source Extensions. "Timeline wise we are hoping to support enough of the spec to support the YouTube production player by the end of the year but will need to collaborate with YouTube to ensure that we're focusing on the right things."