Latency is the amount of delay, measured in milliseconds, found in a round-trip data transmission. Not directly related to speed, latency can be an issue with all networks including satellites. Latency is caused by several factors, including the number of times the data is handled along the transmission path, for instance, by a router or server. Each time a data packet is handled by a device along the path (called a “hop”) several milliseconds of latency are induced. More importantly in the satellite world, latency is caused by the distance that the signal must travel. The satellites used for two-way Internet service are located approximately 23,000 miles above the equator. This means a round-trip transmission travels 23,000 miles to the satellite, 23,000 miles from the satellite to the remote site, and then as the TCP/IP acknowledgment is returned, another 46,000 miles on the return trip. That's a total round trip of about 92,000 miles. Even at the speed of light, this accounts for more delay (in milliseconds) than found in a terrestrial network. Most Internet applications including web browsing, email, FTP etc. work in their normal manner even when traversing this long distance and user experiences are very positive. Certain applications, such as Voice-Over-IP are affected but also work. Some applications, such as online gaming - specifically, first-person shooters - are not recommended. Citrix, and terminal emulators without local-echo, can also be affected by latency depending on the underlying application and configuration. If you have an application that is particularly sensitive to latency, it is highly recommended that customers check with their software vendor to confirm how specific applications are affected.
When I visited my in-laws in Texas this summer, I used their computer to surf the Net. They have Wildblue as their service. The system could handle the big files, but the latency was the worst part about it. It almost seemed as slow as dialup. It was better than nothing.