The movie company sold the rights to show that movie in the UK to some other company instead of Netflix, probably for more money than Netflix offered them.
Also, you're paying a fixed monthly fee, and unless you're part of the small minority that travels a lot, you're not likely to drop Netflix over not being able to watch certain movies in foreign countries, hence they didn't lose anything.
Let’s say you’re a French movie distributor. You know the French market, you know which movies will sell, you know how to market to French audiences. Because of this you can bid more on the rights to distribute movies in France than a global company that doesn’t have any specific knowledge about the French market (your return is likely to be higher and you’re liekely to have fewer failures). Same in the Czech, Romanian, etc markets.
But let’s say this movie conflicts with the release of some other movie you’re distributing so you want to hold it back for three weeks.
What’s your proposed solution? Tell the studio they can only sign deals with global distributors? Tell them to accept less money?
Stop signing exclusive deals with regional distributors. If you're going to put something on Netflix, put it on Netflix world-wide. That doesn't mean you can't also put it on a streaming service based in France that concentrates on French language movies -- do both. Let them each pay you for non-exclusive global rights.
You get paid more per service for an exclusive deal, but you also get paid by fewer services. Which is increasingly looking like a bad deal as the many different services proliferate. Having a hundred buyers is more profitable than having only one buyer that pays ten times as much.
It's the same game they're playing with regional exclusivity to begin with -- get more buyers by dividing up the rights. Rights in one country aren't worth as much as rights world-wide but you can sell them to more people.
The difference is that regional exclusivity makes customers angry and non-exclusive licensing makes customers happy.
It's not that easy to work away from. Which is why Netflix has been paying more to create or co-create content (most Netflix content isn't world-wide exclusive it seems).
Which is another reason not to use regional licensing going forward, and pass laws to disfavor it in general. It increases transaction costs -- then when Netflix or any of your hundred other buyers wants global rights to a particular film, they have to negotiate with a hundred regional distributors instead of just the original creator. The transaction costs go from "N" to "N times M" where N and M are both large. And transaction costs make otherwise profitable transactions either less profitable or not happen at all.
I'm curious what your proposed legislation would be. Just outlaw exclusive licensing? Would you prohibit vertical integration between content producers and distributors or just force vertically integrated companies to license content to competing distributors?
How about a distributor that has an inherent market advantage and so can bid higher on the rights than other distributors? Would that be allowed? Or would you require producers to charge some lowest common denominator fee so that you can't create releases that are effectively exclusive?
I just can't imagine how you would ever effectively police this without taking away a lot of free market rights from participants.
BTW, just so it's clear, I fully support the current EU Digital Single Market rules that try to enforce the fact that you should be allowed to watch your content while you are traveling. I think that's much easier on all sides of the equation because you're not forcing anyone to make additional deals that they don't want to make (i.e. distributing content to other companies when they want it to be exclusive). I just think it's a big step from that to actually legislating away exclusive distribution deals.
A big thing would be to just discontinue legislative support for it. Get rid of any law preventing third parties from circumventing region locks, so that major companies can overtly thwart them.
Then you can get a "tell Netflix I'm in..." selector from your ISP or bank and the problem gets solved by the market itself.
But there are still two big gaps
1. Even for physical or download to own media, you can still strike distribution exclusives and you can make them based on language. I can make a deal with a German distributor that they're the only ones that gets to distribute the German version of my movie. They can choose to delay the release of the German version for as long as they want. If you only speak German then you can't watch the movie even if the French, Italian, Spanish and Polish versions were released 6 months ago.
2. This really doesn't help with SVOD (e.g. Netflix-style) services. I can make exclusive deals with an SVOD provider in Germany and one in France. If the French provider decides they're going to hold back the release of the movie on their service then, sure, with the EU single digital market the German provider has to let you sign up, but now you're signing up for SVOD services all over the place.
This is being actively addressed by the EU:
e.g. I have a colleague who lives in Malmö (Sweden) and commutes daily to Copenhagen (Denmark). Lots of people travel into Luxembourg every day.
When I lived in the UK, the director's family lived on a pretty island in Spain, and he went every Friday for the weekend. Not exactly good for his CO₂ emissions, but people do this kind of thing.
I don't understand this practice as well, when you are paying for a DVD or a VOD service which allow you to download the file, you can still watch it anywhere. Is it illegal to bring a DVD abroad? Why don't they give you the catalog you paid for in first place, everywhere, depending on your country's bank card? Then, no more need to setup a VPN blockade.
I feel these copyright companies often pick the most inconvenient option, even if it's costing them more in the end.