why do I have plenty of storage on my iCloud available but the storage on my phone is maxed out even when it was automatically backed up?
if I am paying for storage and have plenty on iCloud why is my phones storage full?
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iCloud Backup doesn't free up any space on your iPhone.
iCloud storage can be of limited help with a shortage of phone storage -- primarily with iCloud Photos Optimize option. See the information in About storage on your device and in iCloud - Apple Support
including the excerpt below:
You can make storage space available on your iPhone, iPad, or iPod touch when you use iCloud Photos and turn on Optimize Storage. Or you can remove content from your apps—like photos, music, and Podcasts—or delete the apps that you're not using.