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12/14/2007 (Telegraph.co.uk) -- According to the Chinese calendar, 2007 was the year of the pig. According to technology experts, it was the year of Apple.

It has been a bumper year for the California-based company. More than three billion songs had been bought through the iTunes music store since 2001, and that 110 million iPods have been sold worldwide.

Apple sustained the momentum by increasing the capacity of its iPod range, giving it a facelift, adding a new selection of pastel-colored iPod shuffles, and introducing video-playback to a thinner, squatter iPod nano. Oh, and it launched a mobile phone.

Yes, the long-awaited, much-hyped iPhone finally made its debut in the US in June, before hitting UK shops in November. The widescreen, touch screen device boasts a sensational web browser, integrated iPod and some nifty features, such as Google Maps.

There's no 3G, it can't capture video, and you can't send picture messages - but it marks a fundamental shift in the kind of user experience consumers will expect from the internet and their phones. Already, other mobile makers are scrambling to bring out touch screen devices, and the likes of LG's Viewty show that tactile displays are really putting the "digit" in digital.

The iPhone, along with other popular handsets such as Nokia's N95, represents the current pinnacle of so-called "converged" devices - single gadgets that pack in more and more functions. The N95 has built-in GPS software, so you can use it as a satnav device.

The X Series range of phones and price plans from 3 allows users to "sling" TV programs from a personal video recorder at home to their phone, as well as surf the net, make free internet-based calls via Skype, access files on their home computer, stream music to their handset, and chat with friends via an instant-messaging program.

In all the brouhaha surrounding the iPhone launch, it would be easy to miss one of Apple's biggest successes this year - the upsurge in sales of its computers. Apple shipped more than two million Macs between July and September this year alone, a 34 per cent increase on those months last year.

It now has five per cent of the home computer market, but if Apple's rise continues, it may soon be able to think about posing a more serious threat to Microsoft's dominance.

Technology analysts have attributed this boom to a "halo effect", the glow of positive publicity and brand loyalty that comes from good initial experiences with products such as the iPod. And despite some grumbles from Apple users, the release of Leopard, its latest operating system, has been largely well received, not least because it lets Mac users dual-boot the Windows and Apple operating systems on one computer.

But not all that Steve Jobs touches turns to gold. Most tech insiders would agree that Apple TV, which hit the shops earlier this year, has been a mis-step. Designed to stream content from an iTunes library straight to the television, Apple TV hasn't captured the imaginations of gadget geeks: iTunes users can already beam their music around their home using the Airport Express internet router, while the iTunes store has only a limited range of TV shows and films - and they're over-priced. The Apple TV unit also lacks a DVD drive, which means it adds to the clutter in your lounge rather than reducing it.

That's a shame, because video-on-demand has shown signs of finding its feet this year; 2007 could be considered the year when the idea of plugging your television into the internet went truly mainstream.

While BT Vision, a pioneer in delivering on-demand content via the internet to TV sets, has seemingly struggled to sustain its early momentum, several start-up companies that allow people to watch shows on their computers have enjoyed some success. Joost, the brainchild of the team behind Skype, has received rave reviews. Its main competitor, Babelgum, is also building a loyal following.

Mainstream companies are getting in on the act, too. The BBC launched a beta version of its TV catch-up service iPlayer, and plans to roll out the full version on Christmas Day, while ITV reinvigorated its on-demand service to compete with Channel 4's 4oD.

The landscape will undergo a potentially seismic shift in 2008 with the launch of Project Kangaroo, a joint venture between the BBC, ITV and Channel 4 to provide on-demand content and catch-up services on a single platform.

Several new devices were launched to tap into these new viewing habits, including Sony's TP1E home media centre computer and personal video recorder, and bizarrely, LG's internet-enabled fridge-freezer, which hints at true convergence sometime soon.

Still, despite the lukewarm reception for Apple TV, it's been a better year for them than it has for Microsoft. Bill Gates's company seems to have been caught napping, failing to get to grips with a consumer demand for flair, innovation and beautiful design. There's still no indication of when the Zune, its take on the iPod, will hit UK shops; sales in the US are sluggish, although improving since the range was refreshed.

But more worrying for Microsoft will be the backlash against its latest operating system, Vista, released in January. Its snazzy new graphical interface wasn't enough to win over many consumers. Vista makes heavy demands of computers, and lots of people found it sluggish and bloated. Such was the lack of interest that Dell began to offer computers preloaded with the older operating system, Windows XP, as an alternative.

It wasn't a great year for Sony, either. While Nintendo's Wii went from strength to strength, proving impossible to get hold of again this Christmas, and Xbox 360 brought out a slew of excellent exclusive titles, including the blockbuster Halo 3, Sony's PlayStation 3 trailed in their wake.

Following its release in the UK in March at an eye-watering 425, not even the promise of high-definition gameplay and a built-in HD Blu-ray DVD player could persuade people to part with that much cash. Eight months later and at the more palatable price of 279, its sales may slowly be reviving, although it still lacks a good catalogue of compelling titles.

But no review of the year would be complete without acknowledging the explosion in membership of social-networking sites. While musicians and teenagers had long been hanging around MySpace, it was Facebook's decision to open up its site to all and sundry that really propelled the concept into the public's consciousness.

Suddenly, offices across the country were full of people "poking" one another, scribbling on virtual walls and posting compromising photos. Facebook wasn't without its detractors - social researchers declared it overwhelmingly white, wealthy and university-educated compared with the other networking sites, while businesses, trade unions and online security firms warned of the personal and professional dangers of posting unprotected personal information.

But with it, social networks ceased to be the province of bored teenagers and became an acceptable new form of communication.

A useful one, too - businesses and individuals quickly saw the value of being able to connect in this way, and share thoughts, information and ideas. Time will tell whether Facebook and the other social-networking sites, such as MySpace and Bebo, can sustain their momentum in 2008.

Certainly in the past few months Mark Zuckerberg, Facebook's founder, has shown signs of misjudging the social medium, introducing an unpopular advertising system, known as Beacon, which "shares" details of Facebook users' purchases at various websites with all their online friends.

For gadget lovers, this is not a time of year to rest on our laurels: we're already gearing up for two big technology events in January - the Consumer Electronics Show in Las Vegas and MacWorld in San Francisco.

It remains to be seen whether the king of spin, Steve Jobs, can equal the grand unveiling of the iPhone at Apple's flagship event last time around, but with rumours of a touchscreen Mac, an ultra-portable computer and an iPhone nano swirling around, it might not be so difficult after all.

Best of 2007

It's got to be the iPhone. While there is definitely room for improvement, its intuitive interface and stunning good looks have set the standard that all future mobile phones will be judged by.

Worst of 2007

Windows Vista While it's lovely to look at, this operating system can feel sluggish. It has perhaps shaken consumer confidence in the Microsoft brand, and goes some way towards explaining why Apple's star is in the ascendancy. 

(Contributed by Telegraph.co.uk)