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@yayuj A service is a piece of code that has its own purpose. It may be a validation service, authentication service and so on - a class or bundle that you pass data to and get something in return or simply ask to do some work, depending on the service.
Read about the architecture and design patterns - you can start here: https://laracasts.com/recommended-reading
ServiceProvider on the other hand is a class used to bootstrap the service, ie. prepare it, read some config, bind an implementation etc.
Read more in the Laravel docs http://laravel.com/docs/4.2/ioc#service-providers
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