The user-facing business model of YT is quite simple:
> You get to see great variety of videos, but have to watch ads every now and then.
So from their perspective, youtube-dl allows you to steal the content w/o giving anything back to either YT or the creator.
To make this fair/sustainable youtube-dl user would either (A) have to tolerate advertisements in the downloaded video, or (B) pay a fee for each downloaded video.
I'd prefer for youtube-dl to stays small enough, that we can continue to freeload a little longer ; )