Computer software can be categorized as either system software or application software. System software includes operating systems, utilities, and device drivers that control hardware and allow application software to function. Application software includes programs for specific tasks like word processing, spreadsheets, and databases. There are different types of application software such as proprietary, in-house, off-the-shelf, and customized packages, as well as different forms like packaged software, custom software, web applications, and open source software. System software programs operate at a low level to control the computer hardware and enhance processing capabilities.