I notice that Youtube now likes to embed videos using an Iframe, but will still allow the old object method.
I'm just curious which method would be best for people using the site in an unconventional way, like with a screenreader or keyboard-only.
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Have a look at this: http://dltj.org/article/standards-compliant-web-video/ and this one from A List Apart: http://www.alistapart.com/articles/byebyeembed.
Additionally, for accessibility with IFrames, check out this resource: http://www.contentquality.com/tutorial/a11.htm#seven
Finally, WCAG has it's own recommendations for dealing with frames in general: http://www.w3.org/TR/2003/WD-WCAG20-HTML-TECHS-20031209/#frames
I would not be surprised if a screen reader did not support frames at all. It is rather difficult to infer a proper tab order as you are essentially only visually combining multiple separate pages.