Answer / guest

An in-process component is implemented as a DLL, and runs
in the same process space as its client app, enabling the
most efficient communication between client and
component.Each client app that uses the component starts a
new instance of it.

An out of process component is implemented as an EXE, and
unlike a dll, runs in its own process space. As a result,
exe's are slower then dll's because communications between
client and component must be marshalled across process
boundaries. A single instance of an out of process
component can service many clients.

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