Update firmware time capsule only used as hard drive

Upgrading firmware is always a user's personal choice. However, it is usually a good idea to do so, even if you don't do them immediately when they become available. FWIW, Apple rarely updates the AirPort's firmware and will, most likely, reduce that frequency as time goes on since the have exited the networking hardware business. Most upgrades are either for security reasons or other "fixes." If you don't provide remote access to this Time Capsule, even the security upgrades may not been needed.

Alternatively, you can disable the upgrade messages by using the AirPort Utility.

You don't indicate which version of the Time Capsule that you have, but if it is the most recent "tall" or "tower" shaped version, then details about the 7.9.1 firmware update are here:

https://support.apple.com/en-us/HT210090

If you have an older "flat" or "square" version of the Time Capsule, then the most recent firmware update is version 7.8.1. Details on that update are here:

https://support.apple.com/en-us/HT210091

Personally, I think that security updates are important, but if you are the type of person who would not update the operating system on your Mac when security updates are offered, then you can probably pass on the Time Capsule security updates as well.

Chances are, your Time Capsule will not be attacked, but it could not hurt to make things a bit more difficult for the bad guys in case that unlikely event actually occurs.

If you run the new update and do not like it for some reason, you can always roll back the firmware to the previous version in maybe 4-5 minutes time.

If you decide to keep the old firmware in place......and don't want to be constantly pestered to update.......

Open AirPort Utility

Click on the AirPort Utility menu in the upper left corner of the screen

Click on Preferences

Uncheck the first two boxes

If the TC is connected to your main network it will keep bugging you to upgrade.

I would do so just to stop it continually reminding you. The latest upgrade is just security stuff which is mostly irrelevant if your TC is not working as a router.. except for ransomware.. Apple is working hard to prevent ransomware ruining your backups.. so if the TC is holding important files and your backups.. keep the security up to date.

If the TC is connected directly to a computer and not accessible to the network.. you should be able to make the reminders go away. Perhaps manipulate the version.xml file and make sure it is never replaced.

As Tesserax comments.. firmware updates are likely to become few and far between. Only some major security issue would make them look at it again.

Functionality improvements have not been included in firmware since release.