What are your plans for tackling the bandwidth and latency issues?
My first thought was caching and pre-caching proxy servers at the ISP as well as onboard the balloons themselves. Cache servers could also be placed on-site in a rural community if several people shared a single connection to the loon-net.
There also the possibility of putting a cache in the users router, but most router hardware lack the memory for that, though it would still be possible to have the routers run a DNS-cache since that doesn't require much memory.
You could also use data compression to further reduce the bandwidth required. Google already has a project that does this for mobile connections : https://developers.google.com/chrome/mobile/docs/data-compression