If there is any profit on selling an £49.99 RRP game for £15 then the prices are absurd. But bargain after bargain people stop spending games on full priced games (at least it happened with me this Fall/Winter). And then you see games like Call of Duty, Left 4 Dead, etc. are the only selling pretty good regardless of the price.
I understand this as "better sell for some than to not sell at all", as I don't see any other point really. Christmas season is a very bad time to not sell at all, better give the bargains now than later.
Edit: You can't base the prices on the cost of the disk, case and cover. There are production costs also. At £15 they're barely covering the printing costs, distribution and store costs. Unless they're making deals with distributors and the loss comes from Stores/Distributors.
All this based on my little knowledge of how the whole process of selling a game works.