With icloud, why would you need an iphone larger than 16Gb

I am finally getting ready to get rid of my old broken down Droid. I am an apple user, but missed the iphone release with Verizon by about 1 month. Now that my contract is almost up, ready to switch over. My question is, if I have access to icloud on the phone, do I need any larger amount of memory that the 16Gb? Someone I work with was telling me that they sync photos and itunes with icloud and keep them off of their iphone to use up less memory? The only drawback I see there is you have to have wifi or data connection to access your stuff. Is there something else I'm missing? What's the benefit of going with the 32 vs 16 if I can store my data on icloud...besides what I mentioned.

movies
and the bigger adventure and fps and rpg games on ios take up a lot of space
I filled my 16G iphone up with apps alone
suppose if you record a lot with the camera it's the same deal

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