You actually didn't need the internet to play Xband. All you needed was a phone line. You signed up for service, and could play against local competition for no extra cost or pay a flat rate each month to take on Nationwide competitiors. The only time you really experienced lag was when there was a phone call coming in to one of the players' houses at the time they were playing in a game.
I have a few in-game videos uploaded to YouTube in case anyone wants to see what it looked like in action:
http://www.youtube.com/user/Xband411
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