Ping is the time it takes for a signal to leave your computer, hit the remote server, and travel back to your computer. It is usually measured in milliseconds (thousandths of a second).
A couple factors affect ping times the most:
1. Distance between servers. Electronic signals travel about 30% the speed of light. Light takes about 40ms, round trip, from New York to Paris. But the path through cables is definitely not a straight line, so it actually takes much longer.
2. Network equipment. Your router and all the routers and switches on the way to the server will slow down your signal.
How this affects the game:
It’s up to the game programmers to handle the latency, or the time between when you clicked “fire” and when the server gets the message that you clicked “fire”.
One way that first-person-shooters do this is by remembering where all the players are for a small period of time, say, 200 milliseconds. If the game knows you’re on 160ms ping, then it could compensate for that by registering a “hit” if the other player *was* in the path of your bullet 160ms ago when you clicked “fire”.
This method is not fair and it’s not perfect, and it is one reason some FPS players complain of being “shot around the corner”.
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