Today Saiyan island decided to clarify what one awaits Dragon Ball fans in Dragon Ball Xenoverse. They start off with the term local breaking down to you vs the cpu or another player where as multiplayer has you in a free for all. Also Saiyan Island noticed that in local battle you need lock on to go after the enemy where as multiplayer both character are in camera view. This information is looked into further by the videos below. For more stuff check out the article through link below.
Article:http://www.saiyanisland.com/2014/11/dragon-ball-xenoverse-online-vs-local-multiplayer-comparison/
As always thank you for reading.