I know nowadays that doesn’t matter as much due to most DVD players or disc drives being region free, but I recall the time when I was younger in the late 90’s to early 2000’s most discs were region locked based on where you bought a copy (basically the same as buying a Japanese N64 cartridge versus an US one) meaning they won’t work when in another country.
For instance: I’ve purchased the first 2 home alone movies in Japan during my trip back then when they’re re-released on DVD (encoded as NTSC) while I come from a country where most discs by default are PAL so they didn’t work on my normal DVD player, having to purchase a multi region DVD player just to watch them. (This was before streaming sites).


Edit for correction: The PAL/NTSC divide has nothing to do with licensing.
Those are 2 different standards for producing colored TV video, which were developed independently and got implemented in different parts of the world. Before the switch to digital, the entire production chain for media had to match the standard of your TV set. So you couldn’t play US DVDs on European players simply because they were incompatible technically.
Fun fact: The European standard played at 25 images per second, while American movie cameras recorded at 24. So every Hollywood movie you watched on a European TV was sped up very slightly. This wasn’t noticeable in the image or with voices, but the corresponding pitch change could be detected in music if you had a keen ear and knew the original songs.
Your edited correction is the right answer.