I fixed it!!!

I know this reply is 5.5 years later, but this could still help someone. I had the same problem and was able to fix it after hours and hours of searching for an answer. All you need is to have a non-zero value for the buffer in the media player.

Examples:

Using Spark VideoDisplay:

<s:VideoDisplay id="rtmpABRVideo" width="320" height="240" initialize="rtmpABRVideo.mx_internal::videoPlayer.bufferTime=2">
  <s:DynamicStreamingVideoSource host="rtmp://localhost:1935/live" streamType="live">
    <s:DynamicStreamingVideoItem streamName="webcam_1000" bitrate="1000" />
    <s:DynamicStreamingVideoItem streamName="webcam_500" bitrate="500" />
    <s:DynamicStreamingVideoItem streamName="webcam_150" bitrate="150" />
  </s:DynamicStreamingVideoSource> 
</s:VideoDisplay>

Using OSMF Components:

var dynResource:DynamicStreamingResource = new DynamicStreamingResource( rtmp://localhost/live );
dynResource.urlIncludesFMSApplicationInstance = false;
dynResource.streamItems = Vector.<DynamicStreamingItem>([
                                new DynamicStreamingItem("mp4:webcam_150", 150, 320, 240),
                                new DynamicStreamingItem("mp4:webcam_500", 500, 320, 240),
                                new DynamicStreamingItem("mp4:webcam_1000", 1000, 320, 240)
                          ]);

var videoElement:VideoElement = new VideoElement();
videoElement.resource = dynResource;

var mediaPlayerSprite:MediaPlayerSprite = new MediaPlayerSprite();
mediaPlayerSprite.width = 320;
mediaPlayerSprite.height = 240;
mediaPlayerSprite.media = videoElement;
mediaPlayerSprite.mediaPlayer.bufferTime = 2;

addChild(mediaPlayerSprite);

Hope this was helpful for someone out there!

I was pretty sure the VideoDisplay component will display whatever source URL you send it. Without seeing code, I m not sure what is going on.

If you want to display a different bitrate stream you ll have to tell the VideoDisplay component to switch the URL. If you want to do some automatic bitrate switching "on the fly" I believe that has to be done at the server, not the client.

I have posted a post on my blog with some source code that is very easy to understand a while back.

check it out here