Motion picture studios want to control the home release of movies in different countries because theater releases aren't simultaneous (a movie may come out on video in the U.S. when it's just hitting screens in Europe). Also, studios sell distribution rights to different foreign distributors and would like to guarantee an exclusive market. Therefore they have required that the DVD standard include codes that can be used to prevent playback of certain discs in certain geographical regions. Each player is given a code for the region in which it's sold. The player will refuse to play discs that are not allowed in that region. This means that discs bought in one country may not play on players bought in another country.
Regional codes are entirely optional for the maker of a disc. Discs without codes will play on any player in any country. It's not an encryption system, it's just one byte of information on the disc that the player checks. Some studios originally announced that only their new releases will have regional codes, but so far almost all releases play in only one region. Region codes are a permanent part of the disc, they won't "unlock" after a period of time.
There are 8 regions (also called "locales"). Players and discs are identified by the region number superimposed on a world globe. If a disc plays in more than one region it will have more than one number on the globe.
1: Canada, U.S., U.S. Territories
2: Japan, Europe, South Africa, Middle East (including Egypt)
3: Southeast Asia, East Asia (including Hong Kong)
4: Australia, New Zealand, Pacific Islands, Central America, Mexico, South America, Caribbean
5: Former Soviet Union, Indian Subcontinent, Africa (also North Korea, Mongolia)
6: China
7: Reserved
8: Special international venues (airplanes, cruise ships, etc.)
Some players can be modified to play discs regardless of their regional codes. This usually voids the warranty. Some discs, such as those from Buena Vista/Touchstone/Miramax, MGM/Universal, and Polygram contain program code that checks for the proper region. These "smart discs" won't play on code-free players that have their region set to 0, but they can be played on code-switchable players that allow you to change the region using the remote control. They may also not work on "auto-switching" players that recognize and match the disc region.
Regional codes also apply to DVD-ROM systems, but are allowed for use only with DVD-Video discs, not DVD-ROM discs containing computer software. Computer playback systems check for regional codes before playing movies from a DVD-Video. Newer "RPC2" DVD-ROM drives let you change the region code several times. Once a drive has reached the limit (usually 5 changes) it can't be changed again unless the vendor or manufacturer resets it. Information and software for circumventing DVD-ROM region restrictions are available from various Internet sites. Regional codes do not apply to DVD-Audio.
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