I had this same question, as I am very disturbed that Mitel expects that the 3300 (and this is quote from a support tech from Mitel) "with only 512 M of RAM, running a processor less powerful than a cell phone", is expected to be a DHCP server, an FTP server, AND a TFTP server in large environments (my largest is over 700 phones).
When I called tech support about how to set up an external TFTP server, I got lots of "I never heard about doing that..." and "let me talk to the next level...no, they never heard of that either" to a final reply saying "I suppose it can be done, but it would have to be in the exact format as the directory, and you will have to find that out from someone else."
Useless. Mitel support has gotten bloody useless.
Any (rant over), here is what I figure out.
#1. When upgrading the software, don't use the built FTP server on the 3300. It's very damn slow. The majority of your install time is spent just uploading the files (upwards of 40 minutes). Instead, use Filezilla or some other free FTP server. set the Home directory to be where the latest load is that you want to install. When setting up the upgrade in the Software Business installer, set up the IP address to your FTP server, and proceed. I clocked the upload process to be about 20 minutes. The entire upgrade, start to finish, took 35 minutes. And this was on an MXe II. The biggest files on the load (one was the help file) took less than a minute to upload.
now
#2. TFTP for the phones. Please note, it's important that you have these files ready to go, prior to the upgrade process. Once the phones reboot during the upgrade, they are going to be doing those TFTP requests almost immediately.
What I did was copy the files from an already current system, one running the latest load, to prep my TFTP server.
To get those files:
open up File Explorer in Windows.
enter ftp://(the address of your phone system). Use your normal username and password.
find the folder labeled Tftp. Right-click copy that folder. Paste it to your PC in an easy to find location on your hard drive.
If you want to put these files onto another server, copy ENTIRE FOLDER to that server.
Install on the server (or on your PC, if doing it from there) a TFTP server program. I use tftpd32.exe by Jounin. It's the same server I use for upgrading the Mitel 5000. Configure the server so that the "home directory" is that TFTP folder you copied from the 3300.
When you configure your DHCP server (either the external one that the customer uses for the phones, or the internal one on the 3300), make sure that the TFTP address is this new TFTP server, and NOT the phone system's IP address.
Start your upgrade with all these configured and enabled.
The upgrade on the phone system starts its process. Once the phone system comes back on, the phones will be told that there is a new software load, and all of them will reboot simultaneously. However, since we are now pointing TFTP to a different location, the phones will get their software from the dedicated TFTP server, and the phone system won't be bogged down with hundreds of TFTP requests. The download process is incredibly fast for the phones, and they will come up much quicker than if you depend on the phone system to do this (I had a 700 phone system that took 5 hours to get all phones back online with this usual method. Unacceptable!!!!)
I plan on following this procedure in May, when I replace an MXeII with and MXeIII at a college campus. I believe this will be a much faster transition than I originally feared it would be.
Let me know if this method works for any of you out there!