LAN = Local Area Network (Meaning you have to be in the netowrk to play)
Online = Players everywhere
LAN can only be accessed using a IP like 192.168.0.0 and things like that. Basically it's a server that was made in your LAN instead of using a WAN IP (local) that SMOnline uses so everyone can lay.
Which is better interms of everything but functionality, like which has a nicer interface, which plays better (FPS), witch loads faster etc...
Most likely depends on the amount of players, in most cases, SMLan wins all of those simply because it's faster with the lack of tons of players. The interface should be the same though.
SMonline is supposed to make SMLAN obsolete, which is with CNLohr told me on AIM. SMOnline is hosted on one main server that is up 24/7 (some server crashes, but it gets started up fast) instead of a mass of lost servers that no one knows the names for in SMLAN. Plus, SMOnline is the only build being updated (SMLAN isnt being updated anymore, at least not right now). And, like falconsfan14 said, you can play anyone at anytime on the server. More features are being implemented into this build (like live player stats on their forum) and many other underground things they havent told us yet.
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