I have a very good Internetconnection and get lag lag lag. I tried many things nothing helped until I read this:
(you need powerpoint viewer) look for Solution No. 4 how xbox live works.
If you have high performance Internet and and OPEN NAT then in many cases you will lag because you have to co host game sessions. (If you don´t believe me read the powerpoint Solution No. 4)
If I understand Solution 4 right then:
let me explain:
A strict NAT and a moderate NAT can´t connect to each other.
But they can both connect to an open NAT.
think we have 4 players
1. player open NAT choosen as host
2. player open NAT not host
3. player moderate nat
4. player strict nat.
1. player connect to all and all connect to him
2. player connect to all and all connect to him
3. player connect to player 1 and 2 but NOT 4
4. player connect to player 1 and 2 but not 3
the connection between player 3 and 4 has to be bridged. xbox live chooses an open nat with enough bandwith for example player 2.
If player 3 shoots on player 4 for example the packets can´t go direct to player 4 (remember they can´t connect to each other) it takes the route over player 2. So the latency for player 2 increases because he co host the session for player 3 against player 4.
If your game session have many open NAT´s and only some moderate NAT´s there is no problem - but if there are some strict NAT´s ALL connections between them and between all moderate NAT´s needs an open NAT who run their session. This increase latency for the open NAT owner.
If you disable all Port Forward and DMZ and also UPnP then you get a moderate NAT. You can´t co host Sessions, because you can´t connect to all the strict NAT´s. You the get only "normal" lag (because of distance because of ping and so on) but you get no lag because of co hosting too many sessions.
I found it out because on my Firmware I can check all connections and I saw many strange connections.
So what to do: you can disable DMZ disable UPnP and disable port forward - then restart your Router. If you then do the xbox connection test and get a moderate NAT you can´t co host sessions again, because you can´t connect to a strict NAT. For me most of the lag is gone. But if you do it, you can´t connect to friends with moderate symetric NAT´s or strict NAT´s. You can only connect to players with moderate and open NAT´s.
Some people say you have to lower your upload Bandwith for much better experience - I think it´s not a Problem with the game but if you lower your upload Bandwith you will also not co host too much so the lag should also be better. To be safe - try the moderate NAT thing. If I watch my connections with moderate NAT there are no strange connections but only connection from my xbox to all the other xboxes.