Having everyone in the air on the same setting helps ensure that everyone flying through a particular area is on the same setting (and not constantly having to change altimeter settings), so vertical separation between planes isn’t affected by varying altimeter settings (in other words, what matters is your position compared only to other planes, which is why you want everyone measuring altitude the same way)
At lower altitudes, knowing your exact altitude in comparison to ground level and terrain/obstacles can be important
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