ArsTechnica put it into a better perspective (which sadly, most people will probably not see in lieu of the FUD):
1. Youtube wants to offer users a subscription service with no ads.
2. Youtube needs to update its licensing/terms with artists.
-If your video plays for a subscriber they see no ads, artist gets money from subscription pool
-If your video plays for a non-subscriber they see ads, artist gets money from ads pool
3. Artists need to explicitly agree to these terms because it changes how and how much they'll get paid.
4. It doesn't seem fair for a user to pay a subscription, expect to see no ads, and then see ads for some video's because that artist/distributor did not agree to new terms. This is why Google wants all or nothing.
This doesn't seem evil, seems legally necessary and fair to users. Some artists might not like the difference in money they get from viewers on subscription vs. ads - this is likely why some aren't signing.

 http://gizmodo.com/googles-about-to-ruin-youtube-by-forcing-indie-labels-t-1591957089