Earlier quoted context omitted.
Wrong. YouTube obfuscates the URL of the video stream for videos which have been identified as containing copyrighted material and are licensed for streaming only through the YouTube Web player or app. The copyright owner has made the material available under a license which permits ONLY that. Youtube-dl contains code to decrypt the URL of the video stream in order to download and save the copyrighted material, in vi…
Out of curiosity, do you have any insight about how this works when applied to other mechanisms and tools? YouTube-dl has a lot of use cases, among which are the downloading of potentially copyrighted works, in a way which seems similar in my mind to the way a VCR has a lot of use cases including, possibly, the recording of TV shows in violation of a license. Why are VCRs permissible to distribute but not this softwa…
In a nutshell: When Betamax and VHS VCRs came out, tv shows generally aired once, did not repeat, and were not available for purchase on an individual basis. Recording the show to watch later (aka, "time shifting") was the only means some people had to watch an episode.
And importantly: because the episode was not otherwise available (i.e., it wasn't sold or rebroadcast) there was no financial harm to the content owner for copies being made.
DVRs like Tivo relied on this logic as well. And it worked, until the studios caught on and began making film and TV content available for purchase on an individual basis, and offering the content for transitory consumption (aka streaming). By doing so, they eliminated the "time-shifting" rationale of the Betamax case (by offering downloadable copies, albeit at a higher fee, they've also addressed the "connectivity shifting" rationale techies keep bringing up). And indeed, that is why Tivo and other companies stopped selling standalone DVRs in the U.S. and Europe a few years ago. (All of the DVRs you can find today in the U.S. are offered by cable companies or the subscription service providers (Hulu, Youtube TV, etc.) pursuant to streaming and time-shifted viewing licenses they have with the studios.)
Thus, even if the Betamax case was still binding precedent (it hasn't been since the DMCA), it wouldn't apply today.