Transcoding

You send one stream at one resolution and bitrate. YouTube's servers then produce the lower renditions from it, so somebody on a phone with two bars can drop to 360p while another viewer sits at 1080p60. Two consequences follow. Nothing in the ladder can be better than what you sent, so a conservative encoder setting caps every viewer at once. And the ladder takes time to build, which is why a stream that has just gone live sometimes offers only the source quality for the first minute or two. The same process runs on uploads, where higher resolutions finish processing after the video is already public.