The Netflix team is known for using reproducible automation in all their efforts. They have a significant "big data" team that can use and setup automatic classification using hundreds of available data points to classify users who are violating their ToS versus those who aren't. Netflix doesn't do anything that is labor or cost intensive: they have all of this automated.

Even approaching this from a naive set of data points is cheap: It isn't particularly hard to classify IP addresses between cable modem blocks and those for VPS/VPN providers. Geolocation on a country level is relatively reliable. Also it's pretty easy to detect OpenVPN users on layers 2 and 3.:

https://medium.com/@ValdikSS/detecting-vpn-and-its-configura...

http://mailman.nanog.org/pipermail/nanog/2016-January/083833...

I suspect this type of analysis plays a bigger role than most people think.

i.e A user jumping back and forth between US and Australian Netflix - faster than 'physically' possible, would act as a VPN flag.

Personally I had to change the end point of my home made VPN, but have not had any issues since. As a precaution, I have avoided region jumping. If I did, I would try and leave a realistic gap between any access.

Customer has an address in country X, they're accessing from country X and Y in the same day. Probably block.

Not the answer you wanted, not the answer that seems fair, but probably the technically right answer right now, until this situation changes.

They were talking about it a year or two ago, not sure what has happened since then as different countries in the EU have different censorship so it's not that simple (e.g. games in Germany are usually less gore).

This is the only thing I can find about it, but I'm sure it was reported on here on better known sources:

http://www.thesixthaxis.com/2015/03/30/european-commission-l...

What does the Commission plan to do about geo-blocking?

Addressing unjustified geo-blocking will give more choice of products and services for consumers at lower prices. The Commission is planning to make legislative proposals in the first half of 2016 to end unjustified geo-blocking. Action could include a targeted change to the e-commerce framework, and to the framework set out by Article 20 of the Services Directive (on non-discrimination of recipients of services). As a result, traders will have only limited possibilities to deny access to online services.In parallel to legislative proposals, the Commission today launched a Competition Sector Inquiry to analyse the application of competition law in this area (press release and factsheet)

http://europa.eu/rapid/press-release_MEMO-15-4920_en.htm

There's lots to this behind that link, and at the digital single market site (https://ec.europa.eu/digital-single-market/en) but it seems like some DSM legislation will be proposed later this year, but not all of it (since the eCommerce report isn't scheduled to be completed until 2017)

Why then does Netflix force me (American living in Netherlands for years) to use Dutch Netflix when I've paid for an American subscripton for many years? Why haven't they locked me out?

Doing what I suggested would probably cause heck, and yeah, I travel and I love going to new countries and see the Netflix they have there. It's pretty cool :)

What these DNS-based unblocking services do is to selectively point certain hostnames to their own IPs, where they run TCP tunnels to the actual service.

Or (much simpler) use actual IPs rather than hostnames. They can still dynamically change the IPs at will by updating their web code, so it's not hugely worse than using hostnames.