This new feature has been introduced in flash player 9,0,115,0.
Certain standard flash components (dataGrid, comboBox, list etc..) are used by a large number of websites. For example, More than 100 Kb of identical data has to be downloaded for every Flex application (the flex framework) . With the new Flash Player cache, Flex applications will download and start up much faster because users will probably have the framework already in a special cache from one site and will not need to download it again.
The Flash Player cache is not the same as the browser’s cache. It works by storing the contents of a new type of file (SWZ) on your hard drive. When a website makes a request for the SWZ file from the server, Flash Player first checks to see whether it has the matching file already in the cache before attempting to download it.
Besides providing smaller size advantage and thus faster loading, this feature is also beneficial to the application host by reducing bandwidth.