Yes pretty much. Most ISP's just buy access to the cheapest routes which are not always the fastest. I rent servers that are connected to the fastest routes and send the customers game traffic through them. This often results in lowering the latency by a significant amount.
The other thing the VPN does is allows people to choose which region they want to play on. For example, in PUBG, when you launch the game it pings all of the different available regions and selects the one with the lowest latency. This is not always ideal as there may not be any players on the closest servers and you end up playing against a bunch of bots.
Can I ask how you find the fastest links between countries and the servers for them? (Background: during my vacation last month I was playing an MMO from the APAC region but with servers in Germany, and it was crazy high latency. It made the experience quite bad. I wanted to rent my own servers and build a faster link for myself.)
While I can't answer your question as asked (and am not OP), I can at least point out that that when I ping my Contabo VPS I see
- 308ms from my landline ADSL2+ (not on the NBN yet, hopefully soon),
- 350ms over 0-bar 4G (house in blind spot, yay),
- 300ms from EC2 running in ap-southeast-2, and
- 312ms from Oracle Cloud in ap-sydney-1 (okay the x86-64 one was 309, the ampere one was 314-317)
which sorta highlights the sore-thumb reality of transatlantic cables: I'm 16,267km/10,108mi away, and there's very very little I can do about it.
The only thing I do really wonder about is if Starlink does p2p backhaul between the satellites, or if they're just floating mirrors... but after just clarifying that radio waves can't go faster than light I'm now unsure whether that would actually make a difference. Hm.
The other thing the VPN does is allows people to choose which region they want to play on. For example, in PUBG, when you launch the game it pings all of the different available regions and selects the one with the lowest latency. This is not always ideal as there may not be any players on the closest servers and you end up playing against a bunch of bots.