stupidity...
the consequence of this is that they'll just drive people to use VPNs (purchased from companies outside Australia) to bypass these restrictions ... leading to an increase in the other thing they fear which is evil-doers hiding behind encryption so they cant read their emails. I guess it depends on which lobbyist is shovelling cash into their pocket that wins out.
while the rights holders make the rules about what you can watch complicated, convoluted, and feel like they're exploitative (having moved countries, and DVD regions, three times I've given up buying physical media that I can't digitise)