You're missing some key facts:

1. A lot of music on YouTube is fully licensed and uploaded by the owners or Google themselves. Like VEVO music, for instance.
2. Google runs a content match algorithm on all uploads to detect music and movies. If you upload more than four seconds of a song, Google will detect it and transfer all monitization of that upload to the rights holder. This is why music documentaries like Trash Theory only have frustratingly short clips of the music they are talking about, and why channels like Techmoan, which documents weird music formats and playback devices, can also only share extremely short clips.

The rights holders are getting any and all money on music uploaded to YouTube, and your entire premise is flawed.

Buying an SD card full of Roms is piracy, that’s why you have to buy it from Chinese companies and not walk down to the Walmart.

YouTube has agreements with the record companies to pay them for money generated through music uploaded to YouTube. For music where they don’t have an agreement the DMCA means that the uploaded need to verify they have the copyright to thing they upload. Otherwise no social media or file hosting sites could exist.

No idea if you have ever uploaded to youtube but I can't upload audio of my dick slapping my ankle without Disney or universal claiming royalties.

YouTube and Spotify are paying license fees to be allowed to play music on their platform.

Wtf is the tagginator bot?

I can't speak for other countries, but in Italy YouTube pays a lot of money to the Italian copyright holders company for all the potentially pirated videos uploaded by its users.

The music on YouTube isn't any more piracy than unblocked Spotify. YouTube's "official" music uploads (these that are a square with a blurred background behind the square) are acquired by paying DistroKid or record labels. Unofficial uploaders usually aren't monetized, either bc they didn't enable it、are niche、or got ContentID'd by YouTube. Those few that are monetized(e.g. Si𝚕vaGunner and Gi𝚕vaSunner (i.e. not Si𝙸vaGunner or Gi𝙸vaSunner)) usually get DMCA'd eventually.

Downloading from YouTube is piracy though, though like OP says some don't think so for some reason.

Well, this is certainly one of the takes of all time.

Imagine if Pirate Bay or Napster were considered completely above-board businesses just because they took down torrents if explicitly requested by the copyright holders.

That's kind of exactly how the DMCA works. That's the bargain, you take down offending content and make an effort to ensure it does not return and you are allowed to continue to exist and not be sued directly. The problem is that this goes against torrent sites' entire raison d'etre (usually under the argument that they don't even host offending content, just a torrent file) and so it never happens this way.

Just playing devil's advocate (I hate the DMCA for many other reasons), but if service providers were directly liable for what their users did, the Internet never would have grown up to what we know it is today.

I was under the assumption that Youtube had to pay artists for their music being on there? Is that not what is happening?

And if not, how has Youtube not been cease and desisted/sued into absolute oblivion?

Downloading a video game rom is piracy, but if you pay money to some Chinese retailer for an SD card containing the roms, that’s somehow not piracy

Literally never seen this argument, not even once. Guarantee you it’s a very small minority just assuaging some vague guilt (which is BS anyway because it’s still not your ROMs).

People do it primarily because it’s convenient. Downloading and testing hundreds if not thousand of roms - not to mention replacing all the bad ones - would take potentially days of work. Or you can spend like $10-$50 and be done with it.

they have a deal with Vevo i think

I mean... It's been like that through all humanity history, if big guy says black is white, then black is white it is, remember school if you want to examples of that, also another examples can be found in politics of all countries throughout history

Who cares? Google has a legal team for such things, i don't.

I believe their copyright claim system is set up so that any ad revenue for a song goes to the copyright holder, and they can have the video taken down if that isn't enough. It's why YouTubers are so careful not to use too much of a copyrighted song in their videos.

A lot of technologies started out as pirate technologies.

Cable TV? The first people who started shoving TV over cables into people's homes didn't ask for permission. But now that's such a normal thing that we can't imagine it having been infringement at one point.

Player piano rolls too. No permission was sought and its legality wasn't figured out until they got sued. (And the courts decided that a royalty to the composers or rights holders was in order, and the courts set the going royalties rate in cents per roll, but they also decided the composers/rights holders couldn't deny any player piano roll maker the right to make player piano rolls of their songs.)

But then things shifted and now the courts are owned by Disney.