Last time I tried, I was able to load the local file on desktop, and then sync that playlist on mobile (to listen to the "desktop song" on mobile even when offline). So I'd argue it provided similar functionality.
Local files work fine if you're always playing music on devices you own and that have local storage. But if you're using media devices like a Chromecast (unless you're casting directly from a device that has access to the local files), or on machines where you don’t have sync privileges—like a work computer—YouTube Music will work, but Spotify won’t.