I did a quick search and found this fairly concise explanation:
Quote:
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Originally Posted by http://www.davisnet.com/support/drive/software.asp
Software is a broad term for the programs running on any physical electronic device. Familiar kinds of software are operating systems, which provide overall control for computer hardware, and applications, which are optional programs used for a particular job.
Firmware is a form of software that is permanently placed in electronics in order to give the electronic products the critical instructions it needs to run.
For example, there is firmware in a cell phone to tell the phone what to do when you push the power button to turn it on. This firmware is not accessible by the cell phone user and is permanently stored within the electronics of the phone.
Firmware is generally not accessible by the end user to be removed or adjusted. It is often changed by special installation processes or files from the manufacturer as "upgrades."
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Both are really software, it's just the level of ease for which the end user can adjust them. Firmware typically resides in ROM/EEPROM/etc and requires a special "flash" operation to update, like a computer's BIOS. Typical software resides on a harddisk, RAM, Flash ROM (like a thumbdrive), or any storage medium meant for frequent updating.