According to a blog post from Adobe's Flash team, the new Flash Player 10.1 features improved performance, power management and video features. The player has also been given new multi-touch and private browsing functionality. The overall viewing experience for Mac users has been fine-tuned as well.
The new Flash player should deliver an altogether smoother, higher-quality experience for web video, with better buffering, peer-to-peer video and online streaming video.
Adobe also says more details on Flash 10.1 for mobile devices will be announced later this month, but we're not holding our breath for fantastic iPhone news.
As for AIR, this product was released two years ago and hasn't seen a major update until now. AIR 2 improves overall performance and HTML support while reducing memory usage. AIR 2 also includes some new APIs for developers.