Where are the Keys coming from and how is it profitable for them to be sold at a lower price?
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Many game key sellers buy their keys in bulk directly from the publisher. They buy it at a discount and this allows them to sell generally at a slight discount compared to traditional retailers. Game companies are fine, since they’re getting paid, and usually market isn’t big enough to cause any issues with other distribution methods
In the past, there used to be a lot of cross-regional sales of keys, but this is less so now as many keys are region locked. You used to buy keys cheaply from eastern europe, russia, or latin america, and re-sell them to developed nations at a higher price (but still a discount compared to local price).
This also isn’t that new, even in earlier computer gaming days of the 80s and 90s, there were often grey market sellers who would acquire CD-Keys for games or even physical copies of games and software through various legitimate (or less than legitimate) means, and often you bought them in person or via a BBS or mail at a bit of a discount vs retail price. Not to mention all the pirate copies available.
There are three real sources of keys.
The legit sites buy keys from the developers/publishers themselves. It gets weird because of how Valve handle “free” keys for games, but let’s just simplify it and say they are paying what is effectively a cheaper rate per key than MSRP and then they sell it to us as either MSRP or a discounted price. So it is basically the same as any brick and mortar store.
The next two kinds tend to be called “grey market” key resellers… mostly because the only publishers willing to pick a fight (CD Projeckt Red before Cyberpunk and Rebellion because they give zero fucks) are still trying to not alienate consumers too much
The “legit” way involves exploiting regional pricing. There are a lot of regions of the world where the average consumer has very little money relative to the US or EU. So the options are to either not sell any games to them (and make bootleg copies the standard) or to sell at a MUCH lower price point. Key resellers will buy those keys in bulk and then sell them at only slightly less than what the publisher is putting the game up for. Green Man Gaming was notorious for doing this, got caught, claimed to never do it again, and are now once again under-cutting everyone else.
And the final 100% not legit way is to just steal them. Lots of scams where people pretend to be youtubers asking for review keys or where they steal keys out of bundles (either humble or GPU) or even out of physical boxes.
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