This policy setting enables administrators to allow their users to upgrade to Office 365 ProPlus 2016 using a local source.
If you enable this policy, Office will upgrade to Office 365 ProPlus 2016 (when applicable) using a local copy. When you enable the policy, add a local path to the Office files you want installed. For example: "C:\Files\OfficeLocation\"
If you disable or do not configure this setting, Office upgrades will continue as usual from either the internet or a configured Distribution Point.
Important: This policy setting only applies to Office 365 clients that are installed by using Click-to-Run, including Office 365 ProPlus, Office 365 Business, Visio Pro for Office 365 and Project Pro for Office 365. It doesn't apply to Office products that use Windows Installer (MSI)