Because when another compressed format comes out, you don't need to re-rip everything again. You just convert the FLAC files (which are lossless) to the new format.

which encoding programs accept flac input btw? the way i see it, it seems to me that when a bleeding-edge compressed format comes out, we're going to have to convert back to wav format first.... just a bit more of a hassle. actually, probably in linux, you can pipe the native flac exporter to any commandline encoder.... but still its trouble.