Earlier quoted context omitted.
(Googler, opinions are my own) Agreed that it is annoying, but its interesting to look back at how we got here. Google Play Music (GPM) launched in 2011. To get music on here, I'm guessing that team had to sign contracts with the various publishers and record studios. The onboarding and licensing terms of those were likely entirely around this music streaming service. Then you have Youtube. It's been a video hub for…
I'm not sure why the licensing would impact the app in any way. They could swap the backend, keeping the better app. The background video is just one feature to add compared to trying to fix the YTM many problems.
I definitely had friends that used Youtube as a poor-mans spotify and would just keep the videos playing in the background on their desktop.