The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK (

Trefis

) --

Comcast

(CMCSA) - Get Report

recently launched a subscription-based streaming service to augment its current pay-TV services.

The new streaming package is expected to enhance the customer viewing experience which currently revolves around traditional TV programming package and Xfinity on-demand service for TV as well as broadband enabled devices.

The value that this streaming holds comes in two ways. Firstly, it will led to an improvement in Comcast's pay-TV subscriber trends and help it compete better against the likes of

DirecTV

(DTV)

and

AT&T

(T) - Get Report

. Secondly, it will generate additional profits for the company.

See our complete analysis for Comcast

here.

Let's take a look at Comcast and its competitor

Dish Network

's

(DISH) - Get Report

fourth-quarter results. Both companies have been struggling with subscriber losses. Nevertheless, Comcast was able to reduce its subscriber losses to just 17,000 for the fourth quarter, a big improvement that can be attributed to its efforts in improving the overall service.

Similarly, Dish Network was able to register a significant improvement and gained 22,000 subscribers in the fourth quarter. Augmenting the existing services with enhancements such as Blockbuster's streaming service helped to a great extent. Comcast is doing something very similar, a move that could lead to positive growth for Comcast's pay-TV subscribers this year. We see potential upside of 5% to our price estimate if Comcast can regain about 2 percentage points of the market share by end of our forecast period.

For a little over 2 million subscribers, the new streaming service will be available for free. For the rest, Comcast will charge monthly fee of $4.99. If we assume that Comcast's streaming service can gradually penetrate 50% of its total subscribers by end of our forecast period (including the ones who get it for free), the additional profits will lead to just about 3% to 4% upside.

Therefore we conclude that while neither of the above two values are significant in themselves, combined together, they can lift Comcast's value by around 10% which is notable.

We note that while many are counting this move as an attack on

Netflix

(NFLX) - Get Report

, it should not be considered so yet. The limited availability of the service (only current Comcast pay-TV subscribers) keeps it far off the battlefield that Netflix currently dominates. Moreover, this is rather a defensive move to protect the current subscriber base and possibly expand it in future.

If Comcast opens up its streaming service to everyone in the U.S., it can emerge as a serious competitor to Netflix.

Our price estimate for Comcast stands at $26.60, implying little over 10% discount to the market price.

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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.