It just means that the packets cannot reach the server. The reason could be anything: the server could have just gone down, your Internet connection could have just failed, your wifi link could have gotten disconnected, or something could have happened along the way.
However, the real problem is that his game is freezing, which must be indicative of a bigger problem. I think the only person that can really chime in here with a suggestion is Jit (or someone who knows Q2's networking well).