As you may have heard, Stratus is the name of an upcoming service that will allow Flash Player 10 and AIR 1.5 clients to connect directly to one another in a peer to peer mode and exchange data once a connection is established. The protocol used is the new RTMFP (real time media flow protocol) protocol and it runs over UDP, not TCP. The use of UDP has a positive effect on latency and will therefore make Flash Player's peer to peer features ideal for one to one communications and reduce bandwidth costs since the server is sidestepped. You can try the new features using this sample application (Player 10 required).

While the Stratus cloud service is necessary to connect clients in this way, there will also be an upcoming version of Flash Media Server that is capable of facilitating this connection. More information on this is available in this PDF file.

RTMFP is one of the most exiting developments for Flash Player in recent times and it will add major new capabilities to the platform. There are plans to develop RTMFP further, and I recommend you attend the Sneak Peak sessions at Adobe MAX Milan next week where Adobe may showcase application level multi-cast over RTMFP. As outlined by Matthew Kaufman at MAX North America, the RTMFP protocol could evolve further and support one to many broadcasts, Group setups as well as Direct Routing.
Flash Player 10 will not enable swarming, multi-cast or broadcast quality live video at this time.

These are definitely exciting times to be a Flash Platform developer.