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Does Visual Studio 2005 Team System work for geographically distributed teams?

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Does Visual Studio 2005 Team System work for geographically distributed teams?

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The Team Foundation Server source control proxy is designed to boost network performance by caching copies of source control files in a remote location, local to the developer needing the files but away from the main source control location. By storing copies in the remote location, typically connected to the source location through a slower link than your local area network, the proxy helps each individual user avoid a costly download of the files to their workspace across the slower connection.

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