There are three different types of resources that you can use on your website, each with a different purpose.
Public resources are standard, regular resource files: They can be images, videos, PDFs, or any other file type. This is the kind of resource you'd use if you wanted to share a file with the public or post it on a webpage for any other reason.
Private resources are exactly like public resources, except that they are not shared with other users by default.
Private resources are visible only to the user who uploaded them (and any site admins with "Administrator" permission to the folder).
Private resources must be placed into a private gallery with custom permission settings before they can be shared. See Private Files and Galleries for more details.
External resources are entries in the Resources module for files that are saved on other networks, such as files on remote storage systems like Dropbox or Google Docs. References to these files can be saved as "External Resources," and can be included in galleries, displayed in Resource elements, and generally used exactly like public or private resources within your site.
For more information about adding an external resource to your site, see Create an external resource.