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The terms "extension" and "add-on" seem interchangeable, but I have seen instances where people seem to mean different things with "extension" vs "add-on."
Clarity please?
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Add-ons are scripts that run inside Google Sheets, Docs, Slides, and Forms, but they're built by users. Google Extensions: Extensions are mini programs that modify and enhance the functionality of the Google Chrome browser.
Addons.mozilla.org (AMO), is Mozilla's official site for discovering and installing add-ons for the Firefox browser. Add-ons help you modify and personalize your browsing experience by adding new features to Firefox, enhancing your interactions with Web content, and changing the way your browser looks.
Browser plug-ins are a separate type of module. The main difference is that extensions are usually just source code, but plug-ins are always executables (i.e. object code). As of 2021, plug-ins have been deprecated by most browsers, while extensions are widely used.
In October 2018, all legacy add-ons were disabled on addons.mozilla.org (AMO). Users will no longer be able to find legacy add-ons on AMO. If you decide to run unsupported releases to use legacy add-ons, this will make you vulnerable to security weaknesses and we strongly do not recommend that they be used.
Add-ons are installable enhancements to the Mozilla Foundation's projects (and compatible variants such as Portable Firefox). Add-ons allow the user to add or augment application features, use themes to his or her liking, and handle new types of content.
Extensions can be used to modify the behavior of existing features to the application or add entirely new features. Extensions are especially popular with Firefox, because Mozilla developers intend for the browser to be a fairly minimalistic application in order to reduce software bloat and bugs, while retaining a high degree of extensibility, so that individual users can add the features that they prefer.
Reading Add-on (Mozilla) may help
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In this context, extensions are a subset of addons.
So addons are an umbrella term for extensions, themes, dictionaries etc.
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