Faster sites mean users do more stuff
drunkenfist.com
drunkenfist.com
When you are in the "web" mode, you operate asynchronously - click, do something unrelated, return to see the result.
When you are in the "desktop" mode, you expect instant reactions. If it's just a tiny bit slower, you feel something is broken [2].
Now as you make your site more ajaxy and faster, user expectations change, instead of perceiving fast website, they perceive slow desktop application.
[1] http://billhiggins.us/weblog/2007/05/17/the-uncanny-valley-o...
What would be the things to work on to increase the performance? The article mentions mostly the size of the files. I also understand that the lower the number of different files is, the better. What else should be taken into account on the front-end? For example, if I were to use jQuery only for a couple of things, would it be better to have a bigger but simpler JS file? (as in: I rewrite what I need myself but can't match the file size)
In regards to browser rendering performance, YSlow is a good place to start: http://developer.yahoo.com/yslow/help/. The 13 performance rules is a succinct and accurate list of things to look out for.
Steve Souders (creator of YSlow, but now works at Google) does a lot of great work in this area:
http://stevesouders.com/cuzillion/
http://stevesouders.com/ua/report.php
http://stevesouders.com/blog/2008/09/30/hammerhead-moving-pe...
Some more good stuff:
http://www.websiteoptimization.com/speed/tweak/average-web-p...
Did the user search 20% less often because of an imperceptible page load time, or because they became overwhelmed with the number of search results and decided to quit?
User experience drives more activity than performance. Perf is important, but that particular example sounds totally bogus to me.