I have recently completed some tests to see whether a site that our sister company manages has a latency issue and is suffering from being hosted in Europe, rather than here is Australia.
I have to say that when I initially looked at the tests I did think that there would be some effect, having seen delays in the download of some files over the past year or so, however I was not really prepared for the effect that I actually saw.
Firstly to do the test I used Firefox with the web developer toolbar, Firebug installed. Web developer toolbar allows me to switch off caching, so that I could see files as they would be if they were coming to a new user. Firebug includes a “Net” feature that actually let you track when the browser made a request and when it was returned. It also looks at the total time it takes to complete the page.
So the test simply involved setting up a rough duplicate of the home page, hosting that locally, then navigating to both with cache turned off and checking the response time. Note that some of the local files did give errors (which actually resulted in a larger download), these were spacers etc I couldn’t find in the files.
The results….the time to load the page reduced from a massive 36.51 seconds for 300kB, to 14.7 seconds for 350kB when hosted in Australia.
I should also mention that I tested the European hosted page on a high speed connection, and got exactly the same speed. This would seem to indicate that speed on that site is latency limited. My feeling is that this 14.7 seconds for the Australian hosted site is bandwidth dependant (my work struggles at times). I will check this out further and update the posting.
The conclusion: It may seem reasonable to have a large corporate site hosted in a single location worldwide, where content can be tightly controlled. However judging by our tests, the customers user experience will be severely degraded to a point that the site may become unusable.
My advice would be host locally, or if you have to host overseas, check your speeds carefully to ensure you will have returning visitors.