Shopify stores your file uploads in the Files page. You can add these files to your products, collections, pages and blog posts.
You can upload files in all the usual text formats (i.e. .pdf, .txt, .doc etc.) and images as: .jpg, .gif or .png.
The Files page of your admin is where you can:
Upload new files.
Scroll through all of the files you have uploaded.
Click the garbage can icon to remove files.
Click on image links to edit them.
Copy URLs to link to the files from your product, collection, blog post, page, or to link to from somewhere outside Shopify like email or social media.
The images are stored internally as part of our content distribution network (CDN). We remove images and make different sizes of the images as we need to. For instance, if you look at blackmilk clothing, the image url for the main product image is on this product http://blackmilkclothing.com/products/3d-ribs-swimsuit
As you can see, the file name is has been modified by the system to show the proper size we want. You don't direct access to these files.
Hope that clarifies things!
But what if I want to edit the image or change it etc. I mean being able to put a new refreshed image with exactly the same name should just replace the image and hold all the alt tags etc but it doesn't seem to be working that way. I have to upload a new one at the product level and then add alt tags etc. In that case if you have like an add image to multiple products. (as a variant) example a bead chain - goes along with multiple jewelry or key chain type products. I have to replace this image for each product. Why can't I just replace the image where it's stored and have it overwrite the old one keeping everything else in tact (alt tags etc)
Also - with the images that are in files why are they only available by link isn't there a way to click to add media and then search the file section? (currently I have to open another tab, go to the files section and copy paste the url ) am I missing something or am I doing it the correct way?
Product Images are not store with the media files. They are protected