thread title made me think "how is babby formed"
Its about the retail distribution chain, and the co-ordination and control of regional business.
For arguments sake lets say you buy a game in the UK:
- The retailer
- The haulage and distribution companies that delivered the games to the retailer
- The regional dept of the publishing house, and their PR firms / contractors
- The regional dept of the manufacturer (ie. Nint/Sony/MS)
all get a cut - in Euros, Dollars, Yen or whatever other denomination.
Before you bought that game, the retailer spent money buying in stock, paying the distributor, the publisher made a projection of local sales and produced <x> number of copies for sale to retailers, and invested <y> euro/dollars/yen in marketing... maybe the manufacturer also weighed in on marketing efforts.
All of that activity employs people in a given region or locality. Region blocking is about protecting that... it's also about scheduling. Because of localisation efforts, global releases aren't as common as we'd like - therefore release dates vary, and the variables around release windows vary. You would imagine that Activision Europe would concern themselves greatly with EA Europe's plans for their big FPS games for example.
In addition to all of that, it can be about protecting a fiscal plan too. 40 is not the same thing as $40. Maybe they need that money from Europe in the next financial year and not the current one. Maybe they are looking at the markets and feel the return will better effect the balance sheet later on after x,y,z happens in the industry or the wider market...
Someone else mentioned licensing issues around anime -- the same thing applies with film franchises. Trademarks, copyrights and brands all need to be considered in the different regions.
There would be a certain burden of beaurocracy in ensuring and allowing region free globalised releases as well. The software industry is largely regulation free because it is seen to regulate itself through bodies like the ESRB and PEGI. If you allow these bodies to be flouted and circumvented, you could potentially embolden those who would seek to regulate the industry more tightly.
They don't do it just to fuck with enthusiasts. That's just an unhappy side effect.