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padib said:

The system could be vastly improved, such as allowing subscribers to appeal for the video.

It's not rocket science.

Could do, but I doubt that'll be effective, either.  Youtube channels tend to develop a "herd" mentality around their leaders. There's a good chance that they'd all take offense to genuinely flagged videos and start abusing the appeals process.

It's not a big deal either way, though. Flagging doesn't remove content, and if the channel owner (or his agency) haven't bothered appealing, that means they either agree with the flag (remember, they can set this flag themselves), or it isn't warranting them enough lost views to justify the effort to appeal.

If Google wanted to censor, they could do it in far more transparent ways than flagging content, like adjusting search result, making sure videos never get pushed to people's "subscriptions", limiting the bandwidth so that it takes too long to buffer, etc.