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Many web pages nowadays are embellished with Flash animation products, offered by Adobe. Flash technology allows, in a very simple manner, to insert small animated, vector-based drawings into your web pages.
Appealing as these flash animations may be they do have a huge impact on how the website is seen by the search engines. Due to the limitations of search engine optimization for flash sites conversions and profitability of the website will be affected.
What Are Flash Animations?
Flash files carry the extension .fla. For example a file might be named banner.fla where the .fla represents the flash format extention. The file will then need to be exported into a Shockwave Format (extension .swf) for use on the web page.
If the Flash components you have created contains text, it won't be taken into account by most of the search engines, as they don't pay much attention to this format. Still, there are search engines (e.g. Google, dir.com, FAST Search) that know how to read the text inserted in the Flash animations. A web page (or even a site!) that is built entirely in Flash will therefore pass almost "unseen" by search engines, which index, almost exclusively, text content in HTML format. Nevertheless, the HTML file that launches the Flash animation will be crawled by search engine's spiders.
Why Do Some Webmasters Use Flash
It is not a secret for anyone that search engines don't really like sites that are built using Flash exclusively. These sites rarely contain enough relevant text to allow a good indexing. Above that, not all spiders can read the content of a .swf file. Flash is used though every now and then for mini-sites or for campaign sites.
Here are a couple of reasons people find Flash worth the effort.
The impact of animation is maximized with flash and this improves the web's interactive and visual environment.
Flash combines well with other technologies like php, mysql, xml, video, sound etc. This makes it possible to include flash in a completely dynamic website.
Pros

It allows the designer to put more content in a small-sized space without damaging the layout.
It is an easier way to present slide shows or Flash components.
It is a great tool to create banners and ads, and even Flash videos.
It's a good instrument for creating great visual impact and drawing attention to specific points of interest on a web site.
Cons
Flash requires quite a lot of bandwidth and take a long time to load.
The vast majority of search engines will not index sites built entirely with Flash.
You could be at the mercy of the Flash developers - if you use 3rd party Flash developers, they might code the project so that you won't be able to make any changes and you will have to pay them for modifications
The "Back" button is usually disabled for flash websites and also Google's AdWords won't approve pages that have the Back button disabled. So, beware of this if you intend to promote your web site by using a PPC campaign.
Flash doesn't care about the visitors' needs - movies that seem endless- sounds that you cannot turn off they will drive your visitors away.
Splash Pages don't favor your visibility - they lack the text that contains the keywords identified as pertinent to your services / products.
It is not an easy task to optimize flash for the unpredictable search engines. The amount of time and energy it takes for SEO for Flash websites is far greater than the efforts required for an HTML site.