SCCM, Should my unit's distribution point be virtual or physical? And where should a distribution point be set up?
Technical details and considerations about setting up an SCCM distribution point.
A distribution point can be either physical or virtual so long as the distribution point is accessible to your network. The goal is to decrease the load on the SCCM service's servers for distributing packages and to quickly deliver packages to users endpoints in that group.
Network topologically, if you're going to use a physical distribution point it would be wise for that distribution point to be on your group's subnet. Physically, the distribution point can be located anywhere. Typically this computer is installed on-site in or near the group's building or in the same work area as the majority of the group's SCCM-managed endpoints.
If the group works primarily virtually or remotely, a VM hosted with Tech Services in the DCL data center should be fine.
For most use-cases, a VM will suffice. However, groups that contain labs or endpoints that require a multitude of sizable content may benefit from an on-site physical machine, to minimize latency limitations.