Low latency servers have become an essential part of today’s digital economy. They power competitive online games, real‑time video streams and fast financial transactions. When someone plays a multiplayer game or places a trade on a forex platform, tiny delays between the user’s action and the server’s response decide the outcome. Providers therefore invest heavily in infrastructure that keeps latency — the time it takes a data packet to travel from one point to another — as low as possible. Read this article from 1Byte to find out more.
Understanding Low Latency
Latency is not the same as bandwidth. Bandwidth measures how much data a connection can carry, while latency measures the time it takes for data to make the trip. In fiber‑optic cables signals travel at roughly two‑thirds of the speed of light, so even a straight line between London and Amsterdam (around 350 km) introduces about 1.75 ms of delay in each direction. That physical limit sets a baseline for what counts as “low”.
Software and hardware add additional delays. A monitor labeled “1 ms” may actually respond in 3–5 ms. Input devices add another 1–5 ms. Wireless controllers introduce even more delay, sometimes 5–15 ms. Networks contribute 10–30 ms over wired connections and 10–50 ms over Wi‑Fi. Rendering frames takes 5–20 ms depending on the frame rate. Because multiple components add up, hitting a total round‑trip latency under 20 ms is rare and usually reserved for professional setups.
Humans perceive delays differently. Studies show that the average human reaction time to visual stimuli is about 120–250 ms, yet competitive gamers can feel a 15 ms difference between 15 ms and 25 ms of network latency. In financial markets, a 1 ms delay can cost large firms millions of dollars in slippage and missed opportunities. These examples illustrate why low‑latency servers matter even when the numbers look small.
Latency Classes
Latency requirements differ by application. Engineers often break end‑to‑end latency into classes:
| Latency class | Typical range | Use cases and notes |
| Ultra‑low latency | < 5 ms | Hard real‑time systems, high‑frequency trading and critical control. Achieving sub‑5 ms means colocating services, using kernel‑bypass networking and avoiding disk flushes. |
| Low latency | 5–100 ms | Most interactive applications. Games and real‑time dashboards feel immediate when delays stay under 100 ms. |
| Latency‑relaxed | > 100 ms | Near‑real‑time data pipelines, analytics or general streaming where delays of seconds to minutes are acceptable. |
These classes help set realistic expectations. A game may need 20–40 ms total, whereas a standard OTT video stream can tolerate several seconds.
Measuring Latency
Latency is usually measured with a ping test (round‑trip time), a traceroute (showing each network hop), or application‑level monitoring. For real‑time streaming or gaming, round‑trip time and consistency matter more than raw bandwidth. Developers also track micro‑second or nano‑second delays in trading systems, where the difference between microseconds and milliseconds can translate into profit or loss.
Why Low Latency Matters for Gaming
Competitive gaming relies on quick response. When a player clicks, the game engine must register the action, send it to the server, process game logic and broadcast the updated state to all players. Each extra millisecond introduces “lag” — the feeling that an input is delayed. The PubNub study on end‑to‑end latency in gaming states that sub‑10 ms total latency is unrealistic for most players and that most setups cannot break below 20 ms. The article breaks down the components:
- Display latency: Real‑world pixel response is 3–5 ms with additional 1–5 ms of input lag.
- Input lag: Wired mice or keyboards achieve 1–2 ms, while wireless devices add 2–5 ms and Bluetooth controllers add 5–15 ms.
- Network latency: Real‑world wired connections typically provide 10–30 ms round‑trip times, but Wi‑Fi can spike to 50 ms.
- Render latency: Rendering at 240 FPS still means each frame takes ~4 ms, and driver overhead adds more.
These delays stack. PubNub notes that even elite LAN setups deliver 12–18 ms end‑to‑end while good online setups get 20–39 ms. Average gamers, using Wi‑Fi and 144 Hz monitors, experience 40–60 ms or more. Sub‑20 ms latencies are considered elite tier.
Perception and Performance
Gamers’ reaction times highlight why low latency matters. Ghost Broadband explains that professional esports players can feel the difference between 15 ms and 25 ms of total latency. In first‑person shooters, that 10 ms difference means your opponent’s movement appears 10 ms more recent, influencing hit detection and situational awareness. Fighting games run at 60 frames per second (one frame every 16.67 ms), so an 8–10 ms network improvement can mean the difference between landing a combo and missing.
Even though the average human reaction time is 120–250 ms, consistent low latency gives players more time to react. If one player has 50 ms of system latency and a 150 ms reaction, the opponent with 20 ms system latency and 120 ms reaction shoots first.
How Gaming Servers Achieve Low Latency
- Co‑location and proximity: Hosting servers close to players reduces the physical distance data travels. Many popular games maintain regional servers on every continent. Server providers sometimes colocate with major internet exchange points to shave off microseconds.
- Optimized networking: Games use UDP instead of TCP to avoid handshake overhead. Techniques like client‑side prediction and rollback netcode allow clients to act as if they received updates immediately, smoothing out minor delays. Server reconciliation then corrects discrepancies.
- Tick rate and update frequency: Increasing the server’s tick rate (updates per second) reduces perceived lag. High‑tick servers may run at 60–128 Hz compared to 30 Hz or lower for casual games.
- Edge computing: Edge servers placed at or near ISPs or mobile base stations process game logic closer to players, further reducing round‑trip time. As 5G networks deploy, multi‑access edge computing offers sub‑10 ms latencies to mobile gamers.
- Dedicated hardware: Using high‑performance CPUs and network interface cards with SmartNICs can reduce processing delays. LuxAlgo notes that specialized network cards like Cisco’s SmartNICs can provide up to 10× lower latency than standard cards.
- Network prioritization: Quality of Service (QoS) settings prioritize gaming traffic over other data, preventing bufferbloat and jitter. Some ISPs offer “gaming mode” services that provide direct peering with game platforms and content delivery networks (CDNs). Ghost Broadband notes that networks with direct connections to major gaming platforms bypass multiple hops, reducing queuing delay.
Real‑World Examples
Three real‑world examples illustrate the value of low latency. Esports tournaments rely on multiple redundant connections and traffic prioritization to keep delays under 10 ms. Consumer network performance also varies: fiber providers deliver roughly 5–20 ms pings while cable averages 10–25 ms. Finally, technologies such as NVIDIA Reflex can shave 10–20 ms of render latency at the cost of additional driver complexity.
Low Latency for Streaming
Streaming video is another latency‑sensitive application. When watching live sports or an online auction, delays of a few seconds can ruin the experience. Nanocosmos defines several categories of streaming latency:
- High latency: Many traditional workflows introduce >30 s of delay because HTTP‑based protocols like HLS use 6‑second segments and require multiple segments before playback.
- Typical latency: Most live news and sports broadcasts operate between 6 s and 30 s.
- Low latency: Tuned streams reach viewers 1–6 s after capture; many social media platforms fall in this range.
- Ultra‑low or real‑time: Sub‑second streaming is considered “real‑time” and is ideal for interactive entertainment.
Grabyo compares latency across delivery methods. Traditional broadcast TV has about 5 seconds of delay, while some glass‑to‑glass measurements reach 10–18 seconds. Standard OTT streaming (HLS/DASH) experiences 20–45 seconds of delay. Low‑latency technologies like Low‑Latency HLS and DASH aim for 1–6 seconds, and ultra‑low solutions such as WebRTC or HESP can achieve sub‑second latencies. These improvements matter because around 87 % of sports fans use a second device while watching broadcasts. If a social media notification reveals a goal before the stream shows it, the viewing experience is spoiled.
Why Streaming Latency Matters
- Real‑time engagement: Interactive streams rely on near‑instant feedback. Auctions, live polls, watch parties and casino games need sub‑second latency. A 30‑second delay makes placing a bid pointless.
- Second‑screen culture: Modern viewers interact on social media while watching. A stream delayed by tens of seconds lags behind the online conversation.
- Virtual reality and AR: Studies on VR note that motion‑to‑photon latency must stay below 20 ms to prevent user discomfort. Real‑time streaming infrastructure must therefore deliver frames almost instantly.
- Video conferencing and education: Tech Collective points out that video calls become awkward when latency exceeds 200 ms. Remote classes also require low delay so students don’t miss explanations.
How Streaming Servers Achieve Low Latency
Low‑latency streaming involves optimizing every stage of the workflow:
- Segment length and protocols: Reducing segment sizes in HLS or DASH decreases buffering time. Low‑Latency HLS and Low‑Latency DASH use segments of ~1 s or partial segments, enabling 1‑6 s latency. WebRTC, SRT, RIST and HESP are designed for sub‑second delivery.
- Content Delivery Networks (CDNs): Distributing streams across geographically dispersed nodes ensures viewers are served from a nearby edge server. Tech Collective notes that CDNs and edge computing dramatically reduce buffering and lag.
- Adaptive bitrate streaming: By adjusting video quality based on a viewer’s network conditions, adaptive streaming prevents buffering. Adaptive bitrate streaming ensures smooth playback when conditions fluctuate.
- Optimized encoding: Choosing codecs and encoding settings that balance quality and speed is critical. Hardware‑accelerated encoders shorten processing time.
- Player optimization: Reducing player buffering and prefetch settings lowers startup delay. Some players offer “latency mode” where initial quality is reduced to minimize delay.
- Network connectivity: Using fiber connections or direct peering with ISPs reduces the number of hops. Mobile operators deploy 5G and multi‑access edge computing to provide sub‑10 ms round‑trip times.
Case Study: Closing the Live Delay Gap
The BBC recently trialed ultra‑low‑latency feeds on its iPlayer service, aiming to narrow the gap between broadcast and digital. The trial used CMAF (Common Media Application Format), chunked transfer and CDN pre‑fetching to deliver content with only a few seconds of delay. The move reflects a broader industry trend: streaming platforms recognise that fans demand the same immediacy as cable and satellite viewers.
Low Latency in Forex and High‑Frequency Trading
Financial markets are extremely sensitive to latency. Automated trading systems react to micro‑second price changes, and being first by even a small margin makes a difference. LuxAlgo explains that even a one‑millisecond delay can cost large firms millions of dollars. High‑frequency equities trading strives for latencies under 100 ms, while retail stock and Forex trading can tolerate 100–300 ms. Traders who rely on algorithmic strategies therefore choose low‑latency servers or VPS solutions.
Market Data and Order Activity
Latency affects how quickly market data arrives and how fast orders execute. Research cited by LuxAlgo shows that when market data arrives within 500 microseconds (<0.5 ms), fewer than 8 % of orders are cancelled. When data arrives within 50 ms, about 25 % of cancellations and 20 % of trades occur. Delays beyond 0.5 s see higher order cancellation rates. Execution speed also matters: most orders are either cancelled or executed within ten minutes, but 27.2 % of trades happen when participants act within just half a second. These statistics show that shaving off milliseconds at each step increases the probability of successful execution.
Network Speed and Recommendations
Network infrastructure influences trading latency. Direct exchange feeds can cut transmission time by 150–500 ms. Day traders need stable connections; 25 Mbps download and 3 Mbps upload speeds are recommended, and professional setups aim for latency under 20 ms. StreamNative adds that cross‑region network hops add 15–40 ms one way within a continent and 50–150 ms across continents. Therefore, a London‑to‑New York trade can see 100–300 ms round‑trip delays if data travels across the Atlantic. Reducing these delays requires hosting servers in the same data center or at least in the same region as the exchange.
Asset‑Specific and Strategy‑Based Latency Standards
LuxAlgo provides a breakdown of acceptable latencies by asset type:
| Asset type | Recommended latency | Impact |
| High‑frequency equities | < 100 ms | Staying competitive in price execution. |
| Forex | 100–300 ms | Adequate for most algorithmic strategies. |
| Retail stocks | 100–300 ms | Suitable for retail traders; higher latency risks slippage. |
Strategy matters too. High‑frequency trading (HFT) demands latency under 100 ms, while other algorithmic strategies can work within 100–300 ms. A bank updating quotes every 50 ms gains an advantage over a bank updating every 250 ms.
Hardware and Co‑Location
- Co‑location: Hosting trading servers within exchange facilities eliminates much of the network path. Many brokers offer colocation services that place customer servers within the same building as the exchange.
- Direct market access: Bypassing intermediaries and connecting directly to exchange data feeds reduces processing delay by hundreds of milliseconds.
- Specialized hardware: SmartNICs, FPGA‑accelerated cards and high‑performance network switches reduce processing time. SmartNICs can offer 10× lower latency than standard network cards.
- Optimized software: Algorithm optimization and parallel processing reduce the time it takes for a server to process trades. Kernel‑bypass techniques avoid context switching overhead.
- Redundant systems: Uninterruptible power supplies and redundant network paths ensure consistent performance, since volatility can occur if packets are lost or delayed..
Example: Forex VPS
Forex traders often use Virtual Private Servers (VPS) located near broker data centers. Providers advertise round‑trip latencies as low as 1 ms. While such numbers are theoretical, they illustrate the drive for micro‑second accuracy. Day traders who operate across continents may connect to VPS locations in New York, London or Singapore to minimize latency. Some brokers also offer direct cross‑connects between the trader’s server and the matching engine.
Technologies and Techniques for Building Low‑Latency Servers
Low‑latency servers combine optimized hardware, software and network architecture. The following techniques are common across gaming, streaming and trading:
- Fiber and high‑speed cables: Fiber optic networks provide the lowest latency because signals travel at almost the speed of light and avoid electromagnetic interference. Home Connected observes that fiber providers deliver pings around 5–20 ms whereas high‑quality cable networks offer 10–25 ms.
- Edge computing: Processing data closer to users or data sources reduces the distance packets travel. Tech Collective explains that CDNs and edge computing bring content closer to viewers, dramatically reducing buffering.
- Network optimisation: Technologies like BGP routing optimisation, smart queue management (SQM) and quality‑of‑service (QoS) reduce jitter and bufferbloat. Adaptive routing selects the fastest path based on current network conditions.
- Protocol selection: UDP avoids TCP’s three‑way handshake, reducing overhead. SRT, RIST and HESP offer reliable transmission with built‑in error correction for streaming. In trading, protocols like FIX/FAST and custom binary protocols minimise message size and parse times.
- Kernel‑bypass networking: Technologies such as DPDK (Data Plane Development Kit) or RDMA (Remote Direct Memory Access) allow applications to access network hardware directly, bypassing the kernel and reducing copy operations.
- Hardware acceleration: FPGA and ASIC devices accelerate packet processing, encryption and compression. Trading firms often use FPGAs to parse market data in microseconds.
- Monitoring and analytics: Continuous monitoring detects latency spikes and jitter. Tools measure ping, jitter, packet loss and frame times to identify bottlenecks. In data streaming, engineers track p50, p99.9 latencies to ensure worst‑case delays stay within targets.
- Load balancing and redundancy: Distributing traffic across multiple servers prevents overload. In streaming, load balancers route viewers to the closest edge. Trading firms replicate order gateways across several data centers to ensure continuity.
Implementation Considerations and Challenges
Several trade‑offs make ultra‑low latency challenging. Cost vs. benefit is key: storing data in memory and colocating servers adds complexity and expense, so developers should only target ultra‑low latency when the use case demands it. Physical limits mean no setup can overcome the speed of light, making regional servers and colocation necessary for distant users. Consistency matters more than raw speed; a stable 25 ms connection beats an inconsistent 15–45 ms one. Teams must also meet security and compliance requirements and design systems that scale without adding latency.
Future Trends and Investments
Low latency will become even more important as emerging technologies like augmented reality (AR), virtual reality (VR), cloud gaming and telemedicine mature. VR applications require motion‑to‑photon latency under 20 ms to avoid motion sickness. The Tech Collective article notes that Southeast Asian countries are investing heavily in 5G, fibre optics and edge computing. Indonesia’s Palapa Ring project aims to connect remote islands with a national fiber backbone, while Vietnam plans 99 % 5G coverage by 2030. Tech giants like Google and Amazon are investing billions in cloud infrastructure across the region. These developments will lower baseline latencies for users in those markets and enable new real‑time services.
In parallel, streaming protocols are evolving. Chunked transfer using CMAF and LL‑HLS reduces segment size and enables near‑instant playback. Peer‑to‑peer assistance, where viewers share cached segments with nearby peers, could further reduce load on central servers. In gaming, edge computing integrated into 5G base stations will allow cloud‑rendered games to achieve latencies comparable to local play. Trading firms may adopt nanosecond timestamping and more sophisticated FPGA acceleration.
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Conclusion
Low‑latency servers underpin many modern digital experiences. In gaming, shaving off 10 ms can decide a match, and professional players feel differences in the tens of milliseconds. Streaming services must reduce delays from tens of seconds down to one second or less to keep viewers engaged. Financial trading systems operate on microsecond time scales, where even a 1 ms delay can cost millions.
Achieving these low latencies is not trivial. It requires careful coordination of network infrastructure, server hardware, software design and geographic placement. Techniques like co‑location, direct peering, edge computing, adaptive protocols and hardware acceleration reduce delays across the stack. Engineers must also recognize that consistency and reliability matter as much as raw speed; a stable 25 ms connection often outperforms an unpredictable 15–45 ms connection.
As 5G networks expand and edge computing matures, low‑latency servers will become the norm rather than the exception. New applications like VR, cloud gaming and remote surgery will push latency targets even lower. Organizations that invest in low‑latency infrastructure today will be better positioned to meet the expectations of tomorrow’s users and markets.