The package server was building HTTP download sources (codebases) but only creating and sending up UNC download sources.
The package server logs displayed the following messages:
Not all required Features of IIS are installed. IIS will not be used and the package server's virtual directories will be deleted.
Web Server (IIS) role is installed, but the next required Role Services are missing: .NET Extensibility 3.5, ASP.NET 3.5.
Role services or Features missing in the IIS settings.
ITMS versions 8.x
The following are the IIS role services that are needed on package servers, as listed in the Planning for Implementation Guide:
(8.x also requires .NET Framework 4.5)
If applicable, Add All Versions where indicated.
See also KB 164960