In some small areas around a server I frequent, lag spikes will slow the game down and even freeze some players. The areas where this happens appear to be about 1-4 chunks in size, and will cause the problem regardless of altitude.

I have seen this happen while running some basic profiling tools, none of my CPU cores are maxed out, less than 10% of my system RAM is in use by Minecraft, and my GPU load is less than 25%.

Players with less powerful computers are sometimes frozen for times around a minute, before they restart minecraft our of frustration.