SOCKS servers are a form of proxy that are commonly used in firewalled LAN environments to allow access between networks, and often to the Internet. The problem is that most applications don't know how to gain access through SOCKS servers. This means that network based applications that don't understand SOCKS are very limited in networks they can reach. An example of this is simple 'telnet'. If you're on a network firewalled from the internet with a SOCKS server for outside access, telnet can't use this server and thus can't telnet out to the Internet.