There’s been a fair bit of confusion about what iCloud is and isn’t, but let’s be clear about one thing: iCloud DOES partially back up your iPhone, iPad, or iPod Touch, but it does NOT back up your Mac.
This is a major change for longstanding MobileMe subscribers who used Apple’s iDisk with the Apple Backup program. Neither of these features are available with iCloud. iCloud’s primary purpose in life is to provide content synchronization between devices, not backup.
iCloud can, however, partially back up iOS 5 devices when they are connected over Wi-Fi. It will back up original content you create (e.g. photos you take, app documents and settings, purchase history from iTunes/App store). It will not back up anything you sync to the device from iTunes on your computer, those items will need to be reloaded.
For backing up Macs to the cloud — not iCloud, but the cloud — we recommend the CrashPlan cloud backup service. Mozy, Carbonite, and BackBlaze are all well-known alternatives you could also consider.