Windows 98 was the successor to Windows 95. Although it did include some under the hood changes, it was largely a release that contained things previously available for Windows 95, including FAT32 support, Internet Explorer 4.01 SP1 with Active Desktop, and an updated Media Player. It bundled API frameworks that were redistributable on Windows 95, including the current C runtime library (MSVCRT.DLL), HTML Help, and an updated COMCTL32.DLL. It was the first release of a few Windows tools that lived on much longer, including Windows Update and Disk Cleanup. Although FAT32 support was available in Windows 95 OSR2, Windows 98 included a FAT16 to FAT32 converter to allow people who upgrade to benefit from FAT32.
Although Active Desktop comprised a range of technologies, it included support for HTML wallpaper, floating HTML desktop windows, and by default folder windows were written in HTML/CSS to define the layout of folder contents on the right and summary information in a pane on the left. There were also changes unrelated to HTML, including a start menu that supported drag and drop, as well as context menus on start menu items. All of these changes were available for Windows 95 with Internet Explorer 4.
Largely due to the extra resources required to run Active Desktop, Windows 98 required a 486 with 16Mb of RAM, as opposed to Windows 95's 386 with 4Mb of RAM. In practice 16Mb was often insufficient for Windows 98, which benefited from significantly more RAM, as well as significantly more compute to render the much more complex folder windows.
At the time of its release, a Windows 95 machine could be configured to be very similar to a Windows 98 machine, but since the components were optional on Windows 95 users could decide which components and overhead they wanted. This meant Windows 98 had limited value as an upgrade. Over time however, software was released that required Windows 98 and not function on Windows 95, including Internet Explorer 6 and Office XP.
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