Has the multimedia bug bitten you? Do you linger over those iMac commercials promising easy-to-produce home movies? Do your digital audio files outnumber your CDs, or at least your cassettes? And do you even know where your old-fashioned film camera is? Then you might be ripe for Windows Millennium Edition, which offers new multimedia functions (with a decidedly Microsoft proprietary twist, of course). But if you don't need these digital media features and are happy enough with Windows 98, the new operating system may not offer enough to make it worth the trouble of an upgrade. Microsoft is unveiling the beta 3 version of Windows Me next week and expects to ship the final release in the second half of the year. Microsoft says this will be the last member of the Windows 95/98 family. Windows Me beta 3 has come a long way from beta 2. It adds a souped-up digital audio and video player, an improved digital camera interface, and a video-editing program. It's business as usual below decks, though. Interface updates make it look like the relatively crash-proof Windows 2000, but Windows Me still sits atop the same shaky MS-DOS foundation as Windows 95 and 98. Unless you buy a new PC with Windows Me preinstalled, you may not bother with this update. Windows veterans will likely be annoyed by many of the interface changes, wizards, and tools intended to help novices configure and debug their systems. Also, many of WinMe's innovations - including Internet Explorer 5.5 - are or will be available as free downloads. The remaining bells and whistles may not justify the upgrade. Though Microsoft developers are undoubtedly well-meaning, the real impetus behind Windows Me is the bottom line: Get a new product out there that reflects the spirit of the times. These days that means playing and managing digital media files. Its implementation of Media Player deserves an award for most-improved utility. The latest version cribs features from several leading free and shareware players, notably Nullsoft's Winamp (now an America Online property). Like other programs, Media Player handles a range of file types, including MP3, .wav, and CD audio files, as well as AVI, MPEG, and QuickTime video. Its jukebox function searches your drives for media files, and organizes audio files by artist and recording by using an online database. Media Player is also a CD "ripper" that can convert CD audio to Windows Media files stored on your hard disk, but it does not create the more widely accepted MP3 files. Rather, Microsoft is promoting its own Windows Media Audio (WMA) format. And Media Player copies music files to selected portable players. It supports the Diamond Rio, RCA Lyra, and Creative Nomad II, as well as Windows CE devices and the upcoming Pocket PC. Sony devices will also soon support WMA. You won't have to upgrade to Windows Me to get this version of Media Player, though. As with past versions, Microsoft will offer it as a free download. Media Player 7 is expected to be available separately in June, and you can download a beta version of it now. Other Windows Me innovations won't be free for the download, however. Both its new Windows Image Acquisition technology, for use with still images, and the Windows Movie Maker (competitor to the iMac DV) will only be bundled with the operating system. Using Windows Image Acquisition, you can scan images or pick and choose among a thumbnail display of photos stored in a digital camera without taking the additional step of downloading them to your hard disk. Then you just download the images you choose. The hitch is that this works only with a scanner or digital camera that has a WIA driver. Current products do not, but Microsoft representatives say new devices will have the driver. They claim 60 percent of the cameras on the market will support WIA by the end of the year. And if you're the family videographer, Windows Me will turn you into an auteur. Windows Movie Maker is a bit light on features compared to competing products like Avid's Cinema, or Apple's turnkey iMac DV. But the application turns PCs equipped with a video capture device into video production terminals. Again, however, the format of choice is Microsoft's proprietary Windows Media file format. Once you convert and save your videos, you can use the Movie Maker software to edit them, insert still images or silent-movie style captions, add audio overlays, and organize the clips on a storyboard interface. But if movie-making isn't your thing, Movie Maker may be just another useless freebie like the WebTV viewer bundled with Windows 98. Another function aimed at consumers is not new in beta 3: the PC Health improvements. Some of these functions appeared first in Windows 2000 but are refined in Windows Millennium. Notable is System Restore, which lets you bring your Windows configuration back to a previous state - for example, to how it was before you installed some buggy beta download. System File Protection automatically restores a critical system file if it's accidentally deleted, even after you've emptied the recycle bin. In Windows 2000, you have more control over when to apply this function. In Windows Me, it's designed to protect novice users from themselves and could annoy more experienced users. It relies on Microsoft's definition of system critical; it's unclear whether it covers every .ini or .dll file. If you replace a Microsoft file with a third-party file of the same function, will the System File Protection feature override you? Still, this tendency toward handholding may be an indication of the future. Windows Me is the next step in Microsoft's consumer line of operating systems, and it is designed to automate common functions and be easier to use. Microsoft has said it intends to merge the two paths of Windows, so the next jump - to an OS that combines Windows Me and Windows 2000 - may be more abrupt. In the meantime, if the family of multimedia functions of Windows Me doesn't entice you, you can still run Windows 98 and download only the audio-video extras you choose. Alexandra Krasne contributed to this report.