How can Flickr fail at this?

So I’m a big fan of Flickr, but it blows my mind that they have this longstanding bug that doesn’t properly display images with transparency.

Look at http://www.flickr.com/photos/filipx/3031012360/sizes/m/ and http://www.flickr.com/photos/filipx/3031012360/sizes/o/

This is their entire business, and they are some really smart guys. Can anyone explain this to me?