You might have observed while playing a video, when you try to move the seek-bar to even an already played section, the video starts re-buffering from there. It also happens on videos that were already fully loaded.
Understanding the Issue
A time back, YouTube has implemented the MPEG-DASH (Dynamic Adaptive Streaming over HTTP) technology to play streaming videos faster and more efficiently. The idea is to deliver the media by breaking the content into a sequence of small segments. While playing, the player automatically decides the next segment to download and play back based on current network conditions.
The biggest advantage that came out is the video can now be played without any stalls or re-buffering. If your network conditions change, the player will automatically choose low, high or highest quality segment in next block, but it will never stop until its too bad.
So far so good. But this started another problem in media buffering. It only lets you preload the video a few seconds ahead of the playhead, no matter how fast your internet connection is. And due to the same, backward seeking feature goes in trouble.
So ultimately you ended up with no more good experience and much more bandwidth uses.
How-to Get it Fixed
Go to the GitHub YouTube Center page. Get the extension for your browser. For Firefox and Opera 15+ users, official add-on and extensions are available.
Google Chrome users need to add it manually as there is no such official extension available yet. So download this file. Go to Menu -> Tools -> Extension. Check mark the box on right top corner saying "Developer Mode". Now drag and drop the downloaded crx file to this page.
Now head on the YouTube website and click on gear icon located at top most right corner.
Go to the Player tab on right, and uncheck the DASH Playback option.
You will no more be facing backward seeking problems from now.