When the DVD-video format was developed it was decided to include a system of so called "region" numbers. This system is supported by players and discs. The idea was to restrict certain discs to certain players. Because the different players were sold in different regions (countries and continents), this system effectively limits the sale and use of discs to certain geographical regions.
Consumers have perceived this as a way of reducing disc piracy whilst the disc publishers (mostly Hollywood studios) claim it is a way of controlling film release dates for individual regions.
Either way, it's a pain in the arse. Fortunately, DVD video player resellers have responded to public pressure and sell so called "multi-region" versions of popular players which they have modified to disable the region checking circuitry. this makes more sense when so many consumers are buying discs from all over the world on the internet.
Region 1 = Canada, USA
Region 2 = Europe, Japan, South Africa, Near East, Egypt
Region 3 = South and East Asia, Hong Kong
Region 4 = Australia, New Zealand, Caribbean, Central & South America
Region 5 = India, Africa, former USSR, Pakistan, Korea, Mongolia
Region 6 = China
Region 7 = Not used
Region 8 = Special use such as airlines