The Triffids

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There are many purposes that region coding can achieve, but the primary one is price discrimination, i.e., allowing the manufacturer to demand a higher or lower price depending on what the market will allow. There is great disparity among the regions of the world in how much a person is willing to pay for a DVD. Price discrimination is especially applicable to DVDs, as the marginal cost of selling one DVD is relatively small, allowing the seller a great deal of flexibility in pricing.

Another purpose is controlling release dates. One of the traditions of movie marketing that the advent of home video threatened is the practice of releasing a movie (to theaters) later in some countries than in others. Video tapes were essentially regional anyway, since video tape formats had to match those of the encoding system used by television stations in that particular region, such as NTSC and PAL. DVDs are less restricted in this sense, and region coding allows movie studios to better control the global release dates DVDs.