The official white-paper on the subject can be found here: http://go.microsoft.com/fwlink/?LinkId=55933.

This white paper provides an overview of Visual Studio 2005 Team System licensing, focusing on typical configuration and deployment issues. This document will provide a general understanding of the core features, typical deployment scenarios and required licensing for the Visual Studio 2005 Team System product line.

Chris Menegay has some additional information here http://teamsystemrocks.com/blogs/chris_menegays_weblog/archive/2006/02/07/657.aspx.