Basically, a network effect for an open codec.
I am not sure if this is a serious question, but I'll bite in case it is.
Without DRM Netflix's business would not exist. Nobody would license them any content if it was going to be streamed without a DRM.
I don't agree. If people refused to watch DRM-protected content, they would get rid of it.
For example, Pluto TV is a free streaming service that has much content without DRM. GOG lets you buy DRM-free games. Even Netflix itself lets you stream DRM-free content, albeit in low resolution.
They just want DRM because it makes them even more money. Or at least they think it does. I have yet to find a single TV show or film that isn't available on Bittorrent so I don't think the DRM is actually preventing piracy in the slightest. I guess they want it in order to prevent legal tools from easily working with videos, e.g. for backup, retransmission etc.
The low resolution option is something many rightsholders accept, but from a product proposition perspective it's difficult to explain to many customers. They're just grumpy that they paid for content and can only watch it in SD, that reduces your customer satisfaction. Better to do nothing than a poor job sometimes.
I can confirm that while there are serious issues with Widevine (and to a lesser extent PlayReady), the protection measures aren't totally ineffective. My work in improving security had measurable results saving significant amounts of money and reducing content leakage. One memorable time my colleague and I had a call with a big rights owner who tracks the piracy of their assets and they said "Can you tell us what you've been doing recently? Because the amount of piracy from your platform has dropped significantly."
Anti-piracy and content security is also a differentiator between platforms when bidding for content deals. Rights owners will absolutely give the best deals to the provider who provides more assurance and avoid platforms which are leaky buckets.
I know that doesn't fit the narrative, but until recently this was literally my job.
I don't think I've ever looked for a recent show and not seen a pirate version.