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Understanding what bandwidth is can be simple and complex at the same time. Traditionally, users confuse bandwidth traditionally for a speed measurement. In reality, bandwidth is the max capability that networks communications can occur at any one point in time.
Think of bandwidth as a sorts of being a tunnel in a mountain. Lets say that there is a two lane road for this tunnel; one going one way and the other going one way. We could express that bandwidth in this case is 1 car up and 1 car down. Bandwidth is usually provided in two ways; equal both up and down (usually fiber lines) or high down and low up (usually dsl, cable, and hosting providers). In our first example, we would think of this being a fiber line; being equal across.
So what happens if 2 cars need to move at the same time in both directions in order for you to deliver a set of goods? In our first example, your pretty much screwed. Your bandwidth is constrained and you will be only operating at 50 percent capacity. In terms of network traffic, you'll experience a slow down or lag because your packets are not delivered at the required speeds. Therefore, your bandwidth is low.
Now lets says your just insanely rich and you sign up for the big mountain road express. Your bandwidth is 50 cars up and 50 cars down. In the case of using Plex, your required to use 2 cars up per user and 1 car down. In our example, you will be able to support up to 25 users ( 25 * 2 cars = 50 cars < max bandwidth).
Understanding bandwidth is complex because there are many connections between yourself and the server. Your super tunnel of 50 cars may be great, but what happens if the roads that leave your tunnel can support only 10 cars (but they have nothing to do with you and the provider)? Generally, having a high amount of bandwidth (the max support tunnel) will help eliminate causes of slow downs, but other factors may contribute to your problems such as in this case a slow moving cars in your tunnel (lag, delay, latency), QOS (prioritizing someone else over your connections), or just having a crap ISP on your end that slows down your traffic (anti net-neutrality).
Hopefully this provides you some insight! Google some articles about how bandwidth works and how it affects your server operations for more information!