Confused about Wine Classification?
The one thing to remember about wine is that nobody agrees on how to classify it either.
The French, Spanish and Italians, among others, classify their wines by region. The logic is that, over the centuries, they've already discovered what grapes go with what regions. They know what grapes thrive in that temperature and what and it's a waste to grow a less-than-optimal grape.
In most of the New World - that is to say, the Americas - it's all by variety. To a European, it's not champagne unless it comes from the Champagne region. In California, all you need is the right grape and you're in business (as long as you make sure the buyer knows it's California champagne).
This means, in America (as well as Australia), you generally by a Merlot, a Pinot Noir or a Riesling instead of a Sonoma, a Napa or a Willamette Valley. This doesn't mean that the soil is unimportant (an Arizona Riesling would be a terror to behold).
In general, the rule of thumb is this: Europe wants to know where you're from; America just cares who you are. The truth is, both are important - but neither is as important as how you like it.