It's a consequence of google's empire-itis. If they view youtube in the mold of their major business they see they can spend most of their effort working on the technical problems, slap some ads on it, and then call it a day. Even though this might provide a good platform for many people to host videos and is probably revenue positive or at worst neutral for google, nevertheless it doesn't do much to advance an entire new industry.
In many ways youtube would be better without google. The technological problems would be more severe and a bigger challenge, but such a youtube would likely be smarter about finding ways to better monetize content and to pass on that monetization to creators (to create a virtual cycle of new content, and so forth). As it stands now youtube barely acknowledges creators as anything more than any other ordinary users of the site.
In many ways youtube would be better without google. The technological problems would be more severe and a bigger challenge, but such a youtube would likely be smarter about finding ways to better monetize content and to pass on that monetization to creators (to create a virtual cycle of new content, and so forth). As it stands now youtube barely acknowledges creators as anything more than any other ordinary users of the site.