Feel free to find things that say the opposite, i've never seen a study that says "users will choose the slower service, if it's 'better', they just don't give a crap".
And sure there is a diminishing return, but if your latency times are 1s or greater for a web based service, you are almost 100% guaranteed to be losing users/conversions/etc.
"web latency research user conversion rate" on google will turn up a ton.
Heck, back in 2004, ten years ago, you only got two seconds: http://cba.unl.edu/research/articles/548/download.pdf
Now 1 second http://www.australianscience.com.au/research/google/34439.pd...
Even that causes losses: http://www.tagman.com/mdp-blog/2012/03/just-one-second-delay...
Google sees significant effects at 200ms: http://googleresearch.blogspot.com/2009/06/speed-matters.htm...
blah blah blah.
Feel free to find things that say the opposite, i've never seen a study that says "users will choose the slower service, if it's 'better', they just don't give a crap".
And sure there is a diminishing return, but if your latency times are 1s or greater for a web based service, you are almost 100% guaranteed to be losing users/conversions/etc.