How is doing AnimeHaven to cloak the original YouTube video when embedding?

I'm sorry if it's a problem (because of copyrighted stuff) but the link it's extremely relevant to the question: here is a link to a video. (if a mod thinks it's a problem please remove the link, and I encourage everyone to just use Google to find it)

1. Load the default video


2. Looks like a YouTube player with a full 24 minutes episode of Fullmetal Alchemist.


3. Ask yourself: "How the hell is such a high quantity of copyrighted material being hosted on YouTube?!" (the site has hundreds, if not thousands of episodes hosted in the same way)


4. Copy the URL or click the YouTube logo to go to YouTube


5. It's a different video!

By doing that it seems they're preventing people from flagging the videos as copyrighted.

1. If you look at the URL of the embedded player, it's from the youtube.com, so it's definitively the original YouTube player.


2. If you inspect the page while the video is loading you can see the stream coming from a googlevideo.com domain, so it's definitively being hosted by Google.


3. If you look at the streaming URL you can also see a parameter source=picasa

So my current theory is:

1. Host video on Picasa (with Google Drive I guess?)


2. Load the player with an initial public video


3. Inject the Picasa video streaming URL into the YouTube player with the YouTube video, keeping the original video parameters.


4. Avoid flags for copyright infringement!

This is probably agains the ToS of YouTube, or Picasa, or Google, or just illegal for being copyrighted. But it's still very clever trick on their part, since no one has access to the video, no one can flag it for copyright infringement through the usual methods, brilliant! (although very risky, if you're somehow liable!) (and Google will eventually find the loophole anyway!)

I need to know the trick! :-)

TBH I haven't looked too much into their JS yet (and it's probably heavily obfuscated), but I thought that maybe someone already knows how they're doing it, although I haven't been able to find anything related on Google.