In general, the publisher of an assembly simply sent a new version of the assembly to the administrator, who installed the assembly and manually edited the application’s or machine’s XML configuration files. In general, when a publisher fixes a bug in an assembly, the publisher would like an easy way to package and distribute the new assembly to all of the users. But the publisher also needs a way to tell each user’s CLR to use the new assembly version instead of the old assembly version. Sure, each user could modify his or her application’s or machine’s XML configuration file, but this is terribly inconvenient and error prone. What the publisher needs is a way to create policy information that is installed on the user’s computer when the new assembly is installed.
A publisher policy assembly is a way for a publisher to make a statement about the compatibility of different versions of an assembly. If a new version of an assembly isn't intended to be compatible with an earlier version, the publisher shouldn't create a publisher policy assembly. In general, use a publisher policy assembly when you build a new version of your assembly that fixes a bug. You should test the new version of the assembly for backward compatibility. On the other hand, if you’re adding new features to your assembly, you should consider the assembly to have no relationship to a previous version, and you shouldn't ship a publisher policy assembly. In addition, there’s no need to do any backward compatibility testing with such an assembly.