Under the heading, "Permissions and Restrictions":
> The following restrictions apply to your use of the Service. You are not allowed to:
> 1. access, reproduce, download, distribute, transmit, broadcast, display, sell, license, alter, modify or otherwise use any part of the Service or any Content except: (a) as expressly authorized by the Service; or (b) with prior written permission from YouTube and, if applicable, the respective rights holders;
> 2. circumvent, disable, fraudulently engage with, or otherwise interfere with any part of the Service (or attempt to do any of these things), including security-related features or features that (a) prevent or restrict the copying or other use of Content or (b) limit the use of the Service or Content;
> 3. access the Service using any automated means (such as robots, botnets or scrapers) except (a) in the case of public search engines, in accordance with YouTube’s robots.txt file; or (b) with YouTube’s prior written permission;
The users using 3rd party apps don't violate any of these terms (I'm sure you could argue it both ways depending on the specific legal terms depending on the context; IANAL). The app itself is probably violating some of these terms, but for the end users, they are not doing any of the things described, they are just using the app.
I think this is just one of those cases where copyright/IP law moves too slowly compared to the technology it tries to cover.
> They are "accessing ... part of the Service or Content [without being] expressly authorized."
Are they though? AFAIK, law is very pedantic, and technically speaking, a human is physically incapable of accessing Youtube; we use tools to do so. We use some kind of software to access youtube.com, in this case, we are using an app that accesses youtube.com and relays the content on that page back to us. Similar to say, using Chrome or Firefox to access youtube.com and relay the contents on the page back to us.
Note, the APP accesses youtube.com, not the user. The app is (potentially) in violation, the user using the app is not. In fact, the user may not even know that the app is actually accessing youtube. Again, IANAL and I'm sure this is argued both ways, but I'm just saying this is an interpretation of the terms.
I mean hey the NRA has argued this successfully about guns (or maybe their money argued it successfully) so why not? Lets start a rock lobby to allow more rock freedom