How about providing strong disincentives for regional distribution, or at least providing strong disincentives for not having a contract for distribution within a region? I'm aware that this wouldn't work in every situation, because there are regions in which it doesn't make economic sense to negotiate a contract. On the other hand, it should be feasible within the EU.

The problem is that a lot of content is not available in a lot of regions, or consumers are forced to seek out content from distributors in their own region. Finding local distributors is frequently non-trivial, and when it is available it is often at non-competitive pricing and has a host of anti-competitive restrictions. To give you an idea of what I mean, in the context of Canada, a lot of online distribution of television programming is tied to an ISP. In order to access it, you have to have a subscription with that ISP and a subscription to the digital delivery service.

For someone such as myself, the answer is easy: I just don't bother with something unless they want to sell it to me. Clearly they don't, so I do without. Heck, I won't even bother with the free service that they provide because I don't care enough about the product to structure my life around the restrictions (e.g. the one-week window to access television programming.) On the other hand, whether we agree with it or not, a lot of people care about that content to a sufficient degree that the will resort to other means to obtain it. Often that includes piracy or using proxies in other regions, not just because of the cost but because of the relative ease to access it.

In spite of the incentive to expand regional distribution and use distribution channels that are less restrictive, it seems as though industry is unwilling to address the issue on their own accord. They would much rather lobby for stronger legislation surrounding piracy and digital rights management than creating an environment where consumers are wiling and (most important) able to buy their product.