If you see the video but don't hear the audio, the problem is not the stagevideo. Try to set the volume level from the iPhone controls and to ensure that mediaplayer volume and mute properties are set to values that allow playback.
This is part of a mobile training application and I allow the learner to record an audio response in addition to viewing the videos. When they record a response, you can hear the playback so the device has its volume up and working when the app is running. Since I posted this issue, I switched to .flv video and that plays ok. It's apparently the .mp4 video that's a problem. I'm encoding it with ffmpeg and suspect that it's something with the settings. Do you have a recommendation for mp4 settings for OSMF?