I was surprised how a room of top notch 1280x1024 terminals was able to function so well on a shared 10mbps with pretty bad collision detection to boot. X apps of the day were super optimised for local drawing. Even games were super smooth. Toolkits like Motif were all draw calls. By the way back then we thought Motif was bloated lol :)
And then... Came the internet. People suddenly started running NCSA Mosaic in droves that bogged down the single core server. And those browsers started to push lots of bitmap stuff through the pipe to the terminals. Now that was bad, yes. When Netscape came with its image backgrounds and even heavier process people started moving away to the PC rooms :( Because all scroll content needed to be bitstreamed then.
Ps video content at that time wasn't even a thing yet. That came a bit later with realvideo first.
But there was a time when X terminals were more than sufficient, probably for a decade or so.