When Apple first introduced OSX dictation services in OSX Mountain Lion – it was online only, requiring an active internet connection to even use it. Short bursts of speech were transmitted up to Apple’s cloud for translation, then the results sent back to your computer. It was workable – and surprisingly accurate – but very basic and s.l.o.w.
Later versions allow Enhanced Mode – where you downloaded a system file to your MacBook or Macintosh desktop that now enable you to work without an internet connection and also allows continuous dictate mode without the limits and delays. Keep talking and it keeps up.
There’s also far many more spoken punctuation, formatting and document navigation commands available now to manage your Speech-To-Text session with far more control. You can find and enable these additional commands in the ACCESSIBILITY > DICTATION section of System Prefs.