Although there are several good YouTube apps available for Windows Phone, the default out-of-the-box experience for Windows Phone users is not the greatest. Any YouTube link on Windows Phone simply opens up a mobile version of YouTube using the Internet Explorer. Microsoft wanted to better the experience by bundling a full featured Windows Phone YouTube app but Google wasn’t pleased with what Microsoft had done with the app- which was to block ads and allow videos to be downloaded.
Microsoft got vocal about Google’s double standards and after weeks of re-doing the app to Google’s ever changing requirements, Microsoft has given up. The latest 3.2 version of the app goes back to opening YouTube links in a mobile browser.