Innovation/Great Idea of the year: Apple's Expose (note: Longhorn and Gnome's Storage have innovative concepts and ideas too, but they are not out yet).
Best Hobby OS: SkyOS. Robert, a single developer, has really put lots of work into it this year, outpacing in development OpenBeOS, MenuetOS and Syllable put together!
Best Desktop OS: Mac OS X 10.3 Panther (I just hope that Apple stops breaking application and driver compatibility with OSX versions that came out just last year).
Best Server OS: Windows Server 2003. Best. Windows. Ever. (Message to the 'disturbed' people in the comment's section: deal with it).
OS with most overall potential: Linux. With the release of 2.6, Linux is sailing for doubling to ~2% of marketshare for 2004. Let's hope that YellowTAB could develop and market its Zeta OS in a way that I could see more potential there too.
OS dissapointment of the year: FreeBSD. Don't get me wrong, FreeBSD is one of my all-time favorites, but really, it just doesn't evolve as fast as it should have to compete with Linux. Another dissapointment was also eComStation 1.1, lots of installation problems and almost no notable advancements.
Best desktop environment: Luna or Aqua for me. Gnome did some great steps though and became my Unix DE of choice.
Most profound application of the year: I am torn between Photoshop CS and OpenOffice.org (while not as full featured as MS Office or even Star Office, it is free and so that compensates.)
System/Dev software that had huge evolutionary steps this year: Mono. It is getting there and it looks good.
Best Freeware game: Frozen-Bubble. It is so addictive, that it ain't funny anymore.
Best consumer Camcorder: Canon Optura Xi.
Best Prosumer camera: Canon EOS 10D.
Best computer accessory: Apple iSight web camera.
Best upgrade: Memorex or Sony DVD/+-RW (dual format).
Life saver accessory (especially on Apple Cube computers): iMic USB sound card.
Best all-around photo printer: Epson Stylus C84
Best "cheap" film and generic scanner: Epson Perfection 3200 Photo.
Best... Action Figure: 12" Rotocast NightCrawler. Isn't this cute?
Probably I am forgetting a few things, I am sure... Please use the comment section to tell us about your favorites this past year!