The Welsh Rugby Union (WRU) said on Wednesday reducing the number of professional men's clubs from four to two is the best option to secure on-field success and financial sustainability.
Welsh rugby faces its most sweeping shake-up in decades as the governing body unveiled plans to cut the existing teams - Cardiff, Dragons, Ospreys and Scarlets - into two equally funded professional outfits.
The formal consultation process is to begin on 1 September and will aim to "seek views from the entire rugby community from fans to partners and sponsors, related institutions and governing bodies" before making a decision in October.
"We know how emotional rugby is and that people will be hurting when thinking about what this could mean for their team," WRU CEO Abi Tierney said.
"Not everyone is going to be happy but I don't think carrying on as we are is the right thing for fans either.
"We had to do something radically different to get us to a better place and that everyone can get behind and we hope people will step out of their corner."
The WRU said that four proposals are on the table and described two clubs with equal funding as the preferred "optimal option," though it remains unclear which locations would host them.
The plan is expected to face strong resistance, although Cardiff remain under WRU ownership following the April rescue.
On Monday, Dragons' owners emphasised that elite rugby should remain in Gwent.
"We have reviewed the WRU's consultation document and welcome the opportunity to engage constructively in this process," Ospreys said in a statement after the WRU announcement
"There are some interesting ideas within it, including options that we feel hold real potential, alongside others that present more challenges."