I'm having the same problem. I'm on 50mb using the VMGN300 modem. Youtube is awfully slow. If I want to watch a ten minute video in 720p it takes between ten a twenty minutes to load. On any other website though, HD videos stream without interruption. The frustrating thing is, it seams that it's just my PC that's affected. My mom's wireless laptop can stream 720p from youtube.
I've tried installing all the available updates through Windows Update, my graphics card has the latest drivers, I've cleared caches and updated Flash but still... the same bloody problem!
[EDIT] I've just double the speed on my moms laptop. It's in the crapper just like my PC but again, any other non-youtube HD video streams without a hiccup. I've tried connecting directly to the modem to see whether my router was to blame but it makes no difference how I'm connected to the 'net or what computer I'm using. Either there's something wrong on VM's end that only effects youtube (24/7 traffic shaping) or youtube itself is to blame.
[EDIT] I've also tried reverting back to the default dns service as I've heard some people who use OpenDNS (like myself) have had the same problem as me. It made no difference.
[EDIT] It seams as though youtube is working again. Some of the video player behaviour has changed so perhaps it was related to youtube updating.