Java Applets were light years ahead of anything else including Flash. The single only reason why Java Applets did not become the defacto interactive web client side technology is due to (in my opinion) Microsoft. And as another reader pointed out, it's an animated GIF.
From my perspective, the reason they didn't catch on was because they took forever to load and most did gimmicky things like the cheezy water effect. If they had used it to make a YouTube-alike back in the day, it might have caught on.