what does the intensity channel of a point cloud refer to?

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This is typically a sensor-dependent "brightness" of return, representing some quality of measurement: energy returned, pixel value, etc. Sometimes it can look like a greyscale brightness. See the images on the right here to view some images produced by a laser scanner returning intensities.

Just be aware that sometimes it isn't human color dependent. Some materials reflect IR laser beams very well but appear black to our eyes.