I have taken this text from the list of changes in the new Point Release for Quake 3
NEW NETWORK CODE - There is a new compression system built into the network code of the latest point release. Essentially, this reduces the bandwidth usage of Quake 3 and Team Arena by a ratio of 5:1 over previous versions of the game. Modem players, as well as everyone else, should experience a significant improvement in internet game play because of this.
He! I'm happy to hear that, because I saw severe lag in Q3A even with a cablemodem