If Google is willing to eat the initial cost they can start superimposing ads over streams on the fly, on part of the screen, while the stream is running. You can't skip it because you'd be skipping content. They can use AI to figure out areas of the screen where they won't mess with visual content (eg. avoid slapping it over people's faces) but also make it impossible to ignore (eg. not a bar at the bottom you can simply crop out).

On the bright side these ads would probably be less obnoxious than full screen audio/video ads. If they make them tolerable enough we would see a marked decrease in attempts to fight them (especially since fighting against ads imprinted on the video would be pretty hard).

The nuclear option would be to turn on DRM for the entire platform and make it mandatory to have an account to see any video. It would make ripping streams a lot harder but it would nuke the entire ecosystem of YT clients running on every possible device, which were built on the premise they can freely access non-DRM streams. They can probably upgrade the firmware on their latest Chromecasts and abandon the rest but all TVs and older devices would be screwed. They might still get away with it if they give ample advance warning (couple of years).

Depends also on how they intend to reposition the service. They could steer it towards becoming yet another private streaming service, holding all the YouTube library hostage, Not sure to what extent stream authors would be willing, ready and able to move away, given the almost complete lack of competing platforms.

Of course they're going to lose. I've been saying they're going to lose since the first day they started the war. They will always lose and continue to lose. Screw them.