A vertical application or vertical market application, is software defined by requirements for a single, or narrowly defined, market. It contrasts with horizontal application

Horizontal application

In computing, a horizontal application is a software package designed to be used by many different kinds of organizations or individual users, such as office automation, word processing or bookkeeping software.These general-purpose programs address the needs of many people. Marketing, Piping ,...

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An example of a vertical application is software that helps doctors manage patient records,
insurance billing, etc. Software like this can be purchased off-the-shelf and used as-is,
or the doctor

Physician

A physician is a health care provider who practices the profession of medicine, which is concerned with promoting, maintaining or restoring human health through the study, diagnosis, and treatment of disease, injury and other physical and mental impairments...

can hire a consultant to modify the software to accommodate the needs of the
doctor. The software is specifically designed to be used by any doctor's office, but would
not be useful to any other entity.