YouTube is testing a new player for the site as well as an embedded version. But that's not all, in a separate test, Google has introduced a storyboard view to the player. Hovering the mouse over the player bar and you'll see a thumbnail of what the video looks like at that point.
Moving backwards and forwards in the video also brings up a slideshow view of important frames in the video.
The new features are in testing with a few people as YouTube figures out the details. YouTube now generates 100 thumbnails of a any video, the ones it processed already, and uses those thumbnails when browsing through the video.
This could also mean that YouTube is ditching the way it currently generates thumbnails for the videos, which serve as the video covers.