In mid-January of 2016, Netflix made clear their intent to enact Proxy Detection worldwide - AKA they'd be blocking your VPN. Some Netflix users, paying users the lot of them, use proxies or "unblockers" as they're sometimes called, to see content that'd otherwise only be available outside of their country. Why does Netflix block content in the first place? You pay for their service, why don't they let you see all of the content they have to offer? The answer, unfortunately, is precedent.
Each country has a different set of laws applying to content licensing. Each time Netflix wants to license content, they must do so in each individual country in which that content will be shown. As such, it wasn't easy for the folks at Netflix to do the massive multi-country launch they did earlier this month.
Law and Demand
It's the law, not Netflix just being cheap, or cruel. Some content simply cannot be licensed in some countries for a variety of reasons. In other cases, it doesn't make sense to license a particular piece of content in one country or the other due to low demand.
Because it is the law to stream only the content your country has license to, Netflix has an obligation to stop any user from bypassing their restrictions. If Netflix is able to see you streaming content they're not allowed to stream in your country, they're required to at least make an effort to stop you.
If Netflix could just turn a blind eye to the VPN bypassing and make profit from content they aren't supposed to be streaming in your country, they might! But they'd never say such a thing. They want to abide by the law as well as possible - especially at the rate they're growing.
Supply über alles
On the other hand, Netflix suggests that they're aiming to make the same content available in every country for every user. "We have a ways to go before we can offer people the same films and TV series everywhere," said David Fullagar, Vice President of Content Delivery Architecture at Netflix. "Over time, we anticipate being able to do so."
"In the meantime, we will continue to respect and enforce content licensing by geographic location."
Netflix wants to stay in the countries they're allowed in now, and continue to grow in both global coverage and content availability. To do this, they've got to abide by the laws set for them as well as they can, pushing for global content licenses without stepping out of legal line as they do so.