Endpoint Services, MECM, Should my unit's distribution point be virtual or physical? And where should a distribution point be set up?
This guide provides technical details and considerations about setting up an MECM distribution point.
Microsoft Endpoint Configuration Manager (MECM)
University of Illinois IT Pros leveraging MECM, hosted by Technology Services' Endpoint Services team
A distribution point can be either physical or virtual so long as the distribution point is accessible to your networks. The goal is to decrease the load on the MECM servers for distributing packages and to quickly deliver packages to users' endpoints in your unit.
For units with a majority of devices within a single building, a physical distribution point can be installed on-site near the majority of the group's MECM-managed endpoints. A virtual machine hosted with Tech Services is also sufficient. At a minimum, configure the virtual or physical machine with these requirements: https://learn.microsoft.com/en-us/mem/configmgr/core/plan-design/configs/recommended-hardware#remote-site-system-servers
For most use-cases, a VM will suffice. Groups that contain labs or endpoints requiring many applications with large content will benefit from a well-resourced virtual or physical machine beyond the minimum requirements from Microsoft linked above, to minimize latency limitations.