With its July 29 bankruptcy hearing rapidly approaching, Diamond Sports appears to be warming to Comcast’s demands that its regional sports networks immediately migrate to a digital tier—the dreaded cliff path that led to Diamond’s Bally Sports R.S.N.s going dark on Comcast’s Xfinity systems some two and a half months ago. The good news, however, is that Diamond C.E.O. David Preschlack and Comcast’s Greg Rigdon actually are talking, which could be a headline in itself considering that Bally Sports’ R.S.N.s have been off Comcast’s systems since the beginning of May. I’m told that the two have engaged in meaningful negotiations that suggests a deal could be completed by that bankruptcy hearing, which is when Diamond has to convince the court that it has a viable plan to resuscitate the business.

The bad news is that plenty of hiccups still remain. And while the two sides are, at the very least, listening to each other, they remain far apart on a couple of key issues, according to several sources. Importantly, Rigdon has not budged from his demand that the Bally Sports networks immediately move to the cable operator’s digital tier—his original position from the start of these negotiations and one that Preschlack flat-out rejected back in May. Comcast has pushed this same deal with every R.S.N. that has come up for renewal over the past year, including Root Sports in Seattle, SportsNet Pittsburgh, and the Mid-Atlantic Sports Network in Baltimore and Washington. (I’m told that Comcast’s deal with NESN, the popular New England R.S.N. that carries Red Sox games, is up at the end of this year. Rigdon will certainly hold firm with his digital cliff path strategy there, too.)