Electronic software distribution. I googled windows 7 esd after update. Several links there talking about methods used to distribute Windows. Basically, you download software as an update/executable.
http://www.mydigitallife.info/window...ownload-links/
I didn't read the entire article. Mainly because I am a bit lazy right now. But from the skim over that I did do, my best guess is that it has to do with a new way Windows 7will be updating. Since 8 is due out soon, I imagine that they will standardize the update process for all platforms.
You clued me into something I now have to pay attention for on my servers. Got to do some checks in the morning.