SINCE THE BEGINNING of the year, the media has been going nuts over the Internet, $500 "Network Computers" and Windows 95. But it's missed the rags-to-riches story of the year: Windows NT.

Sales of NT have tripled in the past six months, according to Microsoft. The number of software developers writing NT apps has doubled in the past year, to more than 10,000.

Some analysts predict that sales of NT will exceed those of UNIX by the end of the year, and that there will be more users of NT than UNIX by the end of the decade. Network administrators love NT Server's low cost, ease of use, stability and power. Unfortunately, NT doesn't scale as well as UNIX. Although NT theoretically supports up to 32 processors, performance tanks above four. When you run SQL Server 6.5, though, Microsoft says NT sports near-linear scaling to eight processors, but this depends on the type of hardware you're using. UNIX scales well up to 16 processors; some vendors sell 64-processor UNIX servers.

Microsoft hopes to compensate for NT's scaling inadequacies through clustering. Licensed from Digital, this new-to-NT feature allows multiple NT servers to behave as one. In other words, Microsoft achieves high-multiprocessor scalability by putting those processors in multiple machines and clustering them. The main advantage of clustering on the UNIX platform has traditionally been fault tolerance. But for NT, the main advantage is scalability.

Microsoft inked a cross-licensing deal in May with mission-critical server vendor Tandem Computers. The deal extends to the NT Server platform Tandem's high-end ServerNet clustering and NonStop ServerWare Solutions middleware technologies. It also extends NT's reach in midrange and high-end corporate networking, and gets Tandem in on the NT gold rush. As part of the deal, Tandem will help Microsoft develop a clustering standard, code-named Wolfpack, which is scheduled for an early 1997 release.

NT is also about to take over in the Web server arena. Microsoft's Web server application, Internet Information Server (IIS), will ship free with NT 4.0, the next version of the operating system, which is due in August. It's a pretty compelling price point for what is almost universally recognized as a first-rate product.

Windows NT Workstation is best known as a platform for CAD/CAM and other high-end graphics applications. For the three years NT has been in existence, it hasn't been ready-for-prime-time as a regular corporate desktop. The hardware was too expensive. It required too much memory. It wasn't compatible enough with our applications.

But all that is about to change. In May, Intel rolled out the Pentium Pro 440FX chipset, which will drop the prices of 180- and 200MHz-based PCs way down into the range of affordability. Our cover story this month features two Pentium Pro systems that go for about $3,600 and $4,600, respectively. That's thousands less than the price of earlier 200MHz Pros we've reviewed. These Pentium Pro-based motherboards are perfect for Windows NT Workstation because they're optimized for ultra-fast, full 32-bit operation. And they're great for corporate installations because they have built-in Desktop Management Interface (DMI) support, which radically reduces the burden of supporting large numbers of workstations on a network.

Major vendors, including AST, Compaq, Dell, Digital, Gateway 2000, Hewlett-Packard, IBM and Micron, are already announcing cheap Pentium Pro boxes based on the 440FX chipset. And many of these companies--though long known for rock-bottom Windows clone PCs--are already prominently advertising NT machines to the Windows-buying public.

One other drawback of NT is that it craves memory. And because it has practically no resource limitations, you're going to want even more memory than it needs.

But at the same time, memory is also becoming more affordable. Kingston Technology, for example, dropped the price of its DRAMs by 20 percent in May, the company's third major price reduction this year.

Cheaper chips and plunging PC component prices are making NT computing incredibly affordable. What do I mean by affordable? I'm talking about fully loaded NT machines with 32MB of memory in the $2,500-to-$3,000 range by the end of the year--the same price you paid two years ago for your now-moribund 486.

All this sounds great--for Microsoft. It appears NT is poised to become the de facto corporate standard, both on the desktop and in the server.

But there are still a few gotchas. On the server side, the whole movement into the midrange and high end depends upon clustering in the short term and better chip-level scalability in the long term. Both are still solidly in the future tense, rather than the present. In other words, it remains to be seen if Microsoft can pull it off.

On the desktop side, NT lacks Plug and Play and mobile-computing support. And at the microkernel and file-system level, Win95 and NT are still very different operating systems. That means utilities are likely to be incompatible for the foreseeable future, and legacy (Win 3.x and DOS) applications aren't going to run well on NT anytime soon.

The choice between Win95 and NT on your corporate desktop boils down to this: If you don't need PnP and you don't need to run a lot of old applications, install NT. It's a better, faster, more robust desktop OS that now runs on cheap hardware.

If you're not sure, take advantage of Microsoft's 32-bit Family Maintenance License, which lets you install either Win95 or NT and even switch back and forth for the same price. You need 25 or more users at your site to get in on this.

Win95, though, is a no-brainer at home and on notebooks, as well as corporate systems that need PnP or legacy support (which, in 1996, still account for the vast majority).

For two decades, UNIX has dominated the high-end corporate server market. And for five years, Windows has owned the corporate desktop. But there's a new kid in town, so watch out: Windows NT is moving in.