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Innovation/Idea: That I realized that I should be focusing on making art and music instead of wasting my time with computers. That certainly changed my life for the better.
Best computer hardware: STAudio DSP 3000! it works great, it sounds great and it's fairly cheap. (Even though the DSP 2000 is a bit old it's still a better low budget choice though).
Most annoying trend: USB gadgets, and USB devices in general. Some things just aren't meant to be portable.
Biggest dissapointment: Zeta. It just keeps getting worse, and the company behind it scares me. AmigaOS 4 doesn't look very promising either.
Best desktop environment: None. They are all both good and annoying. The least annoying to me is still BeOS, I think Luna or Gnome comes second.
Best development tool/language: REBOL! best way to develop internet-tools in no-time.
Coolest OS: Contiki
Application with most potential: Mozilla Firebird. After being a fan of opera for many years, this saddens me, but Firebird does provide a much nicer experience these days. Opera needs to work hard to clean up their UI or else they'll have no future.
OS with most potential: I'd like to say OBOS but it's too early, I'll have to go with linux on this one.