Why do games sometimes have to be restricted by region?

I dont understand for example why I wont have access to some Japanese games if I get the American version of the new 3DS. I just hate being restricted by formality, not by some technical problem.

Because Nintendo is antiquated and behind the times.

Because business and legal reasons?

If you don't region lock a game and start selling it in say Europe first, other regions might begin to import and buy the games. If a company wants to control their product, perhaps because they might not have the rights to release some content in other regions, they region their games. Also it serves to give the publisher about how well the game does in each region.

Since it's about Nintendo, it's because they still believe in regionlocking. If you're in Europe, import a unit from Canada on launch and save a motherload of money on the unit and the games and wait 6-18 months less for games to come out in their European form.

If it the question arises about non-regionlocked games on non-regionlocked machines, it's about matchmaking to specific servers, often special editions for those games edited to fit those regions, such as the Japanese GTA5 and how it only worked with Japanese GTA5 copies on their specific servers whereas the rest of the world had a true international thing going. GTA5 was like the fourth or fifth best selling game of 2013 in Japan for that matter so no problem finding players for company even right now.

It might seem arbitrary, but there's a good amount of money and work required for legal purposes etc. The most obvious example is all the different rating boards they have to deal with, as we've seen with certain games getting banned or modified in certain countries. Then there's also the localization factor to consider. At some point it's just not worth it if they're not gonna sell enough copies in that region.

Further, if you have a company with publishing offices in multiple regions, locking the game prevents the sales of one region version cannibalizing the potential sales of other regions. This was why Atlus region locked the original P4A. The Japanese office was afraid that their audience would buy the North American release as an import, because (as I understand it) the economics made the import version cheaper than the domestic Japanese release. Therefore, Atlus USA would have cannibalized sales that should have been intended for the Japanese office.

corporations want to operate their supply chains on a global scale but restrict the consumers to a local market. Because give me your money.

I'd imagine region-locking allows you to keep track of revenue streams more easily, too. Say you have a product out across all-territories but the exchange rate in one makes it beneficial to import. It skews the sales heavily towards one region and ultimately loses the developer and publisher revenue.

From the aspect of figures, it could skew where the company might market based on a series popularity. Lets say a significant number decide to import a game from the US to the UK to save £10 on a purchase. It'll impact the US sales figures and erroneously give out the impression this game has a larger market in the US than it should. So they market the next product heavily in the US, ignoring the market that may have made the product popular. Region-locking keeps tabs on that.

All good answers so far that mostly boil down to: money.

Let me tell you region locking fucking blows when you're an English speaker living abroad. Nintendo's archaic region-locking policies have pretty much assured I'll never own Nintendo hardware again, or at least not until they make a region-free console. In Korea, Nintendo games don't get localized for months, and then they only localize maybe 10% of them, and when the few finally do get here, they're only in Korean. Even the last generation of non-Nintendo hardware had language options in almost everything that made it here. And because they weren't region-locked to begin with, the vast majority of them made it to Korea.

To be fair to Nintendo, piracy is rampant here. The DS had sold more units than games at one point since flash carts were standard accessories sold right next to the handhelds in many a video game store.

http://en.wikipedia.org/wiki/Regional_lockout

Money.

Say you lived in a country where they could get away with charging double for videogames and consoles as another country. Obviously people will start looking towards importing and possibly reselling. The big company doesn't make all the money they can and then the money men at the top get upset.

Because sometimes it's cheaper or quicker (or sometimes both) to import a game. So they do it to keep sales in that region.

Nintendo definitely does it to an extreme, and since it takes so long to release games here, I'll probably buy a 3ds the next time I'm in the U.S.

Which I assume is the reason Europe gets fucked over so often.

Germans don't like being reminded of the mistakes their ancestors made.

The short answer is: economics. Due to exchange rates there are actually cases where you pay for a game in one currency and sell it in another currency without any "funny" price or market manipulation and you automatically make/lose money.

I always thought the main reason was licencing, where a game may not have the appropriate rights to use some content; or a publisher may not have the rights to distribute games in certain territories.

As others have said, another important reason is to prevent market cannibalization. For example, pricing in Japan works different than in the US (it is based on demand instead of a fixed price), so it is not uncommon to find games (even Japanese games) costing way more there... so, they region lock them to force people to buy on their local market instead of importing them.

The other reason is censorship or ratings. A game content may be illegal in some region (like Wolfestein in Germany), so they have to region lock it to prevent people there to get access to the original content.

@brodehouse: The real answer is a little bit more complicated than that, but this is hardly the place to expand on it... I will just say that it is not only Germans that feel uncomfortable about it.

My frame of reference is Australia, but yeh same stuff as I understand it. I remember when i imported a few games on the 360 i would import from the UK since the region stuff was the same and it was like 30 percent cheaper.

Taxes, if I import a game I'm not paying 20% VAT that the government would otherwise steal from me.

Generally, the Japanese industry wants to keep charging $100 a game, instead of competing with the global game industry.

And exchange rates. The biggest example of which, is how Canada is dicked around all the time - publishers have forced our prices up due to the exchange, but didn't give us squat when our dollar was just as strong vs. the US.

I think to avoid lags? I dont know what exactly is the reason. This is only my opinions.