Tuesday morning, I had a brief chat with Scott Woodward of WebSourced, Inc., on the elevator at the San Jose Mariott, where I stayed during the Search Engine Strategies conference. My first impression of Scott was that he’s a friendly approachable guy. He told me he was enjoying the conference and greatly looking forward to the Advanced Link Building session.

When I told Scott I was going to the Optimizing Flash Content session, he shot me a skeptical look. “Google is indexing Flash files - theoretically,” he said, “but not a lot of Flash files appear in Google’s top ten listings and I’m not sure they ever will.”

Search engines such as Yahoo! also seem to be skeptical towards Flash. Tim Mayer, Yahoo’s Director of Product Management, asked the audience in the Optimizing Flash Content session how many people had a Flash site that ranked well on the search engines. Out of the entire room, only 4 – 5 people raised their hands.

”Yahoo doesn’t currently crack open Flash files to follow links and extract textual elements,” Tim admitted. He later advised designers against creating “All Flash” sites for this reason. “If you create a Flash site you’re at a disadvantage. … The best idea really is to create an HTML and Flash version of the site.”

“Google is currently ‘reading,’ so to speak, the Flash embedded text,” said Gregory Markel, Founder/President, Infuse Creative. The search engine also follows links and references to obtain the Flash content. He added, “Google is returning Flash files intermittently, and I’ve seen it turned off and on.”

Although Google will not reveal the details of what it’s doing and how, George Shaw, Creative Director, divinePenguin, claims to have proof that Google actually is reading the text embedded in Flash images. The tip-off: after receiving spam emails, he began to wonder how the harvesters were finding his address. “I Googled myself,” he said, referring to a late night search for his email address and, low-and-behold, one of the results was his email address, embedded in a Flash .swf file. Of course, I haven’t seen this myself, and neither has Greg, although we told George we’d be quite interested to see such evidence.

Unfortunately, despite Google’s steps in the right direction, its technology is far from being a solution. Some people are now turning to Macromedia, which, for the first time, seems to be taking an interest in this continued problem.

“Why aren’t Flash sites accessible? It’s a trust issue,” said Macromedia’s Waleed Anbar. (This marks the first time Macromedia has been invited to speak at a Search Engine Strategies conference.) Waleed promises, “This is something we’ve really started to care about [at Macromedia].”

Great, but why did it take Macromedia so long to care? And how much of that interest is genuine?

Macromedia has been offering SDK, a tool allowing search engines to index all links and content in a .swf, since 2002. However, extracting text from a .swf file provided little value to the searchers. Greg says Macromedia only began to show real concern in Flash optimization a few months ago.

Many designers consider only aesthetics when creating their sites and “that could be catastrophic for [Macromedia],” Greg said, if the company chooses to pour money into marketing a Flash optimization product. Designers want their files indexed but there is currently no search engine that can read text embedded in images. Further, many designers don’t seem to want to take the time to optimize the files or even make accessible versions of their sites. Out of the entire audience, only three Flash designers said they’d searched Macromedia for Flash SEO information.

Right now Macromedia and Yahoo! are currently in talks and are trying to move forward. Greg’s been in on those talks and says the search engines have very valid trust concerns regarding Flash, including worries about cloaking. “The goal,” Greg says, “is to be as honest as you can because search engines are trying to catch spammers.”

Meanwhile, there is another effort underway to make Flash sites more search engine friendly. RichMediaSEO.com, Greg and George’s collaborative effort, was launched at Search Engine Strategies this week. The new product aims to make Flash files crawlable, searchable, indexable, and more – virtually solving all the major Flash SEO challenges. Could this be the light in the dark for Flash?

At least one of the audience members seemed to walk away from this session with increased hope. David L. Schooley of Revshare had a few of his own questions answered during the session. He said he’s very excited about the future of Flash but the fact that people seem to lose faith in Flash due to these issues disappoints him. He thinks Flash will ultimately overcome these obstacles. Do you agree?

If you have any further questions or concerns about Flash optimization, you can contact Waleed directly by email: wanbar@macromedia.com