File types are used as a centralized way in which administrators can change settings for all files of a particular type. For example, an administrator can change the encoding of all files of a particular type. The change will then be applied to each user when they next update their workspace.
Each file belongs to one file type. The file type of a file can be changed by any user able to edit the file, as described in the Add, Edit & Submit section of the PureCM User Guide.