Testing an application includes all kinds, it doesn't matter
whether it is Project or Product.

But QA activities varies little bit when it comes to project
based testing and product testing. These variations are
because of time available to test and reporting. Generally,
product based companies will have sufficient time to do
enough rounds of testing before it is released. But it may
not always be true with project based companies.

Also standards for projects may change from project to
project based on customer demands. But in product based
companies, standards remain same (although they keep improving).

In project based testing, QA has more responsibilities and
many times they have to report to customer where as it is
not the case in most product based organizations.

In project based testing we will conduct the testing with 
respect to particular customer requirements , and in 
Product based there is no particular customer we will make 
the testing based on overall market requirements .

example for Product based testing : MicroSoft and Yahoo 
etc.,
example for project based testing : retail applications 
etc.,