Last week, a ‘proper’ version of the YouTube app finally landed on the Windows Phone. Billed as version 3.0, the app brought with it a number of awesome features specific to Windows Phone users, including the ability to download videos to view them offline, play videos under lockscreen, pin channels and a whole lot more. Overnight, YouTube went from being a desperately poor web-wrapper to probably the best YouTube app available on any platform. Now, Google is demanding that Microsoft remove it.

The latest hullabaloo between the arch-enemy tech giant has to do with YouTube’s API and terms of service, which Microsoft is now violating, according to Google. Francisco Varela, Director for Global Platform Partnerships at YouTube, let it be known in a letter to Microsoft’s Todd Brix that he wasn’t happy about the new app, asking Microsoft to remove the app from Windows Store by May 22, and simultaneously disable all existing downloads.

According to Varela, Microsoft falls foul of Google’s laws in three ways:

• Viewers can download videos from YouTube
• The app plays videos on devices that have restricted playback on certain platforms
• The app prevents Google’s all important ads from being displayed

Varela seemed to be especially pissed about the last one:

“Content creators make money on YouTube by monetizing their content through advertising. Unfortunately, by blocking advertising and allowing downloads of videos, your application cuts off a valuable ongoing revenue source for creators, and causes harm to the thriving content ecosystem on YouTube. In addition, your application overrides specific decisions made by some content creators to keep their content from displaying on certain types of devices, which in many cases are due to exclusive distribution arrangements those content creators have with third parties. YouTube’s agreements with creators give them choices in how their content is presented and distributed, and your application takes away that control.”

Now we can understand why Google isn’t best pleased about Microsoft circumventing its ad revenue streams, but to be honest it’s arrogant behaviour is almost certainly what provoked Redmond into doing so. For over two years, Google has repeatedly refused to allow Microsoft access to YouTube’s API (despite giving it to Apple), preventing Windows Phone users from enjoying a decent YouTube experience ever since the devices launched.

Fair play to Microsoft then, it doesn’t look like it’s about to roll over in this instance. The company’s statement in response to Google’s demands puts the ball firmly back in their court:

“YouTube is consistently one of the top apps downloaded by smartphone users on all platforms, but Google has refused to work with us to develop an app on par with other platforms. Since we updated the YouTube app to ensure our mutual customers a similar YouTube experience, ratings and feedback have been overwhelmingly positive. We’d be more than happy to include advertising but need Google to provide us access to the necessary APIs. In light of Larry Page’s comments today calling for more interoperability and less negativity, we look forward to solving this matter together for our mutual customers.”