When you purchase extra cloud storage, does that allow more storage for music, apps, and so forth to be downloaded?

When you purchase extra cloud storage, does that allow more storage for music, apps, and so forth to be downloaded?

So only documents? it doesnt store pictures, videos, or any of that stuff? or it doesnt store settings to your applications? I just want to know how exactly iCloud can effectively help me with storage because I only have a 16 gb ipod 4s. I have already decided I will not download any music onto it or videos

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