I was lucky enough to have the chance to use the satellite-based Lufthansa/Connexion internet connectivity several years back. It was a FRA-HYD leg (Airbus A340), and used 802.11<mumble-probably b> (wifi) onboard.

The inflight map showed our aircraft over some interesting terrain - one wingtip of the icon was over Baghdad, and the other wingtip was over Tehran. Compelled to let someone/anyone know about this (how geeky can one be?), I fired up the laptop and was able to use an instant messenger application to chat with my wife and a few co-workers. The cool-index was pegged.

The latency was noticable, but the connection worked well - I even tried streaming a bit of video, and it worked fine once the connection was going. I'm thinking that the groundstation was doing some form of pre-caching to make the browsing experience acceptable.

I haven't tried the gogo service yet (based in Denver, never need p.s. flights), but given that it's terrestrial-plane link is cell-based, it should have significantly better latency.