What is stream?

How does it work, and why are games so much cheaper from it?

 

steam?

 

You mean steam right?
Online gaming store/client/DRM service created by Valve corporation. Games can be bought on Steam, and there are often game sales and bonus pack deals for promotions (Bioshock sold for $10.00 on Boxing Day). There is also a social networking aspect a la Facebook, where you can make friends, join gaming groups, etc.

There are a growing number of games which are using Steam for DRM purposes. These games are, once installed, tied directly to Steam and not your computer. The pro to this is that you can play said game on ANY computer with Steam installed using your account. Games also update themselves automatically. The con is that is that Steam has to be running for the game to play, althought offline mode exists.
Source- Urban Dictionary

 

steam is a client where you log in with your steam username and password (you need an account, it's free to create one)
once you made your account and logged in, you can buy games and play them