Yes, that too. My understanding (though this was before my time) was that "application" used to refer to the use, whereas "program" was the thing you ran. So "word processing" is an application of your computer, while "Microsoft Word" is the program you use to do that. That was according to my dad, who worked for IBM back in the days of punch cards, but it's possible that was just his own distinction.
But by the 90s, you could describe Microsoft Word as either an "application" or "program" (or "app"). They were all fairly interchangeable. Admittedly, though, it could have been a regional thing, since we didn't really have the Internet yet (yes, it existed, but it wasn't in heavy practical use for most people).