First of all, I should explain the difference between progressive download and streaming. A progressive download is that the file starts playing once the beginning of the video has loaded. Streaming, allows you to go to the middle of the video immediately and start loading from there.
If you want to stream a video, you'll need to use either FMS or Red5 a free, opensouce alternative to FMS.
If you just want progressive downloading, you don't need FMS or any other piece of software/hardware. Flash's NetStream will do. :)
General notice: from now on, I would like to ask everyone to put [AS2] or [AS3] (corresponding to the version of actionscript you are using on your project) in front of their post titles when the question is actionscript related! Please help us help you faster. Thank you.