Downside

Everyone can hear everything including tactics and moaning

Its easymode for those who cant figure out what the enemy is planning so they need to hear them talk about tactics because they are bad players

Im wearing a helmet so no one can hear me

Deal with it

Want intel in EVE? get a spy in the corp and chat channels and work for it

Want intel in DUST? ask for a scrub mechanic which offers nothing to the game or gameplay

If you cant cope now without proxy maybe you should quit

Simple solution, make it mandatory but I'm impartial to proxy chat because despite the "usefulness" of proxy chat it's mainly going to be used for trolling

I still say that turning voice on by default is much, MUCH more important than prox chat.

And that prox chat doesn't have enough benefits to balance out the additional lag it would cause, and the illogical fact that enemies will be able to hear your encrypted voice transmissions while your acual voice is sealed inside an armoured suit.

If you had the option of an "open channel" broadcast where anyone in range could hear, that might be cool, but it should be something you trigger manually, not an automated system. You should be required to hold a button down to transmit.

Also, because they've already got enough functions to fill up the PS3 controller, we'd either need a rewrite of the control scheme or custom controls that let you drop functions you don't use off the controller (like push to talk).

I honestly don't understand why people are SO adamantly against proxy chat. The realism argument is stupid. (it always is, for anything related to videogames, unless you're playing a simulator)

Proxy chat would:
Make it easier to communicate with someone who isn't in your squad, and perhaps isn't in team chat. Besides, wouldn't it be faster to stand near a guy and talk, vs searching to find whatever channel they're in?

It would also add an element of depth to the game. Spying on opponents. Being able to stealthily get near (within 10m) an enemy and hear what their plans are. Or even just know they are around a corner because they can't shut their mouth. This would also give a little more reason for players to level up their stealth (using profile dampening skills and mods)

For those that say that the spying is a BS mechanic, I'd tell you to just shut your mouth ... problem solved. Or as many Eve guys would say... HTFU.

Regarding the trolling argument as it being the only thing players would do. You can say the same thing about LAVs and even guns. I've seen players purposefully TK others using the "runaway LAV" trick. I've also seen players spend SEVERAL minutes following a guy around just shooting hundreds of rounds into their back... just to be annyoing.

If someone is going to troll, they'll find a way. You cant keep out a useful tool for communication, because someone MIGHT use it to troll.