Package archives are repositories containing packaged software, which can easily be updated through the package management. Ubuntu uses the same packaging like Debian (and many Debian packages), identified by the file extension .deb.
Ubuntu organizes its packages archives by several components; this gives an indication, how Ubuntu developers support a software and whether it is free and open source or not:
Contains all packages importent for a working Ubuntu system; therefore they are maintained by developers of Canonical, the compony behind Ubuntu, over a defined period of time. That includes technical support and security updates. This software is free and open source.
Contains most packages. However, this software is not maintained by Canonical itself, but by the community, on a voluntary basis. Again, this software is free and open source.
Even a basically free Linux distribution such as Ubuntu does not come without unfree components. These may be, for example, the firmware for hardware components such as WLAN chips or drivers for graphics cards – so-called “blobs”, whose manufacturers do not supply source code, but only binary data. Unlike Debian, which has strict policies, Ubuntu makes installing such software from Restricted easy, but you have to trust the manufacturers.
Contains non-free packages, that is, the software is under a license that is not compatible with that of Ubuntu, and therefore is not maintained by the Ubuntu developers. Installation at your own risk.
A special case. Here Canonical provides commercial software like Skype or Adobe Flash. Those who can not or will not do without such programs can activate the Partner repository; then install and update these programs as usual by package management.