The alternative HTML is used in case the base <OBJECT> tag experiences a problem when loading or the browser cannot use ActiveX objects as embeds. Of course if this property is accessible from the OBJECT object during scripting, the browser must have parsed the <OBJECT> tag, although it may still have had problems with the component.
This HTML is enclosed between the <OBJECT> and </OBJECT> tags in the HTML document source.
Certain tags are likely to be omitted from the altHTML property value. <OBJECT> blocks contain <PARAMETER> tags for passing values to the embedded ActiveX component. Clearly you won't want these appearing in the display if the component fails to load. The <PARAMETER> tags are considered integral to the <OBJECT> and it's smart enough to disregard them as it constructs its alternative HTML block.
Browsers that cannot understand and render <OBJECT> tags should also ignore the <PARAMETER> tags too.