Microsoft Knowledge Base Article 927374 contains the following INTRODUCTION:

The Microsoft Compression Client Pack 1.0 for Microsoft Windows XP contains the Msdelta.dll file. The Msdelta.dll file is a library that is part of the Windows Vista operating system. The Msdelta.dll file exports functionality to create and apply binary deltas. These deltas are used to efficiently download updates for Windows Vista. This advanced compression technology is also suitable for many other differential compression scenarios.