Proximity chat

Exactly, this is how the Steam game Squad does it, so it's possible and necessary 

Communication

Solid communication is a soldier's best friend when engaging the enemy. To help facilitate navigating the complexity of communication on the battlefield, Squad provides a world-class in-game VoIP system that allows players to talk to other soldiers locally, in-squad, between squad leaders, or even to the overall team commander. Map tools and in-world markers aid fire team leads and squad leaders to inform their soldiers of on-the-fly engagement tactics.