Even though shares of Disney (NYSE:DIS) recently reached an all-time high, there is still plenty of room for the shares to move up in the ongoing bull market. The recent short-term agreement between Dish Network (NASDAQ:DISH) and Disney has been an immediate catalyst, as has been the ability to continue to raise pay-television fees over time.

Dish network agreement
In the latter part of September, Disney and Dish agreed to extend their existing agreement over the short term, in the hopes of working out a longer-term deal. Details about the short-term agreement weren't released by the two companies, but shareholders liked the news anyway--shares of Disney have climbed over $3.00 per share since the announcement was made.

The expectation that a long-term deal between Dish and Disney will occur has provided support and a catalyst for Disney, even though the length of the short-term agreement is unknown. Disney has kept a blackout of its various channels from occurring, with approximately 14 million subscribers represented by Dish Network.

It has to be assumed that Disney will continue to generate revenue from its deal with Dish Network over the short term, at least. The share price movement confirms that shareholders and investors believe this to be true.

Issues at stake
The major sticking point between Dish and Disney is the AutoHop technology employed in the Hopper set-top boxes placed in homes. This allows customers to easily skip commercials with the click of a button.

Dish is battling ABC, CBS, 21st Century Fox and Comcast's NBC in a lawsuit over the use of the popular feature. It's unlikely to be resolved in the current deal between Disney and Dish because of ABC's involvement in the lawsuit. Apparently, there will be some type of caveat concerning the lawsuit results and the deal with Dish that Disney is currently working on.

Also, part of the negotiations are the terms of the deals for the upcoming launches of the Fusion channel (a Hispanic offering) and the SEC Network, which is expected to launch in the second half of 2014.

These two new channels should be cash cows for Disney, especially the SEC Network, which focuses on Southeastern Conference sports. The Fusion channel is a joint venture with Univision Communications and Disney's ABC News.

Even though Disney has been running on all cylinders in 2013, it has flattened since May 15 when it was trading at $67.67. It recently closed around $68.50, pointing to the fact that much of the growth so far in 2013 was in the first several months. Part of the reason for this was the terrible performance of the Lone Ranger and the uncertainty surrounding how much leverage Disney has with pay-television fees.

The most obvious and important franchise in that regard is ESPN, which all carriers want to offer. Challenging that is the increasing pressure on cable and satellite companies concerning the increasing prices they must pass on to their
customers as fees climb. This is why there are a growing number of battles over the fees, battles that are going to escalate in the future.

For now Disney should do OK, but it is a concern over the long term. There is only so much wiggle room content companies have in raising fees, and it appears that they are close to reaching a cap. That would put a lot of pressure on Disney over time if it has little revenue growth in its top content franchises.

Outlook for Disney
The major concern over Dish Network's AutoHop technology centers around Disney's ESPN franchise, which it continually bumps up in price. Advertisers love it because about 96% of those who watch sports do it live, which eliminates concerns about the number of people who actually watch the commercials.

In the near term I don't think this will be a problem. However, it is a problem that, over the long haul, will have to be addressed to the satisfaction of all interested parties.

Disney is still going to be Disney in the long term, and I still consider it a terrific investment. Even so, it looks like market pressure could cut into its growth rate and earnings over time, and investors will need to keep that in mind when looking for a good entry point.