Difference between File Source (External File Sources) and Network Folder Connector Addon?

Recommend using the Network Folder Connector.
It gives you the opportunity to promote selected documents (add metadata while leaving the file in its original place) and to migrate (move the file into the M-Files environment). And you get the advantage of full text indexing.

bright-ideas.dk which one is better for setting permissions in M-files?

In File Source you can specify one account for accessing the external folders. All M-Files users will have access through that account. You cannot limit access beyond that.

Network Folder Connector can be configured for the users to access the external content using their own local user accounts on that folder.

In both cases permissions are controlled by the external source, not by M-Files. M-Files can only control permissions to some extent once you have promoted the files to managed documents. In this situation it is still possible to access the external files directly from outside of M-Files and beyond the control of M-Files. Once you have migrated the documents M-Files can control permissions to the full extent .

Perfect, thanks bright-ideas.dk

Perfect, thanks bright-ideas.dk