Content Categories are one of the Content Type objects of a Content Model. Content Categories are used to organize Document Types and create hierarchy levels in a Content Model for hierarchical data modeling.
A more complicated set of documents may exist, where some Document Types are a sub-category of a larger Document Type. This could just be useful for logically organizing Document Types into categories. Furthermore, this is part of creating a hierarchical structure in a Content Model. The Content Category, as a child of the parent Content Model, will inherit the Content Model's Data Model and its Data Elements. Document Types, as children of the Content Category, will inherit the parent Content Category's Data Model (including the Content Model's Data Model that it inherited).
For example, if a set of documents contains Invoices, Checks, Receipts and Purchase Orders, they might fit into a Content Category of "Payments" and other Document Types might be placed under other Content Categories. All of the Document Types in the "Payments" Content Category would inherit from both the Content Category and the Content Model itself.