Quite simply, it lies about what it's doing. Try playing one of its video files without an internet connection and it makes the issue obvious. The only thing this is doing is creating a file that will enable you to stream the video from where it is hosted. If the host moves or deletes the file? Useless. If the host modifies the file? You lose access to the older copy you thought you had.

This level of misrepresentation should be taken as active deception.