Well, the conversion of all human existence into digital form continues to make steady progress. Few real obstacles were encountered this year, despite repeated attempts to frighten us off, and next year looks to be no different. There are of course the power struggles that m'learned colleague Bernard Keane has characterised in his little ebook as The War on the Internet. Battle is being waged by those whose position relied on them being a gatekeeper of information or by those who, quite frankly, simply failed to react to the somewhat unmissable rise of the internet over the past decade and a half. Hello, Gerry Harvey. How are those shops going again? Last year I predicted that those who saw themselves as losing out would fight back even harder in 2011. They did. The internet was increasingly portrayed as a dangerous place that needed to be brought under control. Scary headlines, courtesy of the big information security vendors and their well-funded PR departments, warned us that hackers were no longer just ordinary organised criminals after your credit card -- although those guys were still at work and we saw plenty of questionable statistics that proved it. Now, nation states were involved too, conducting cyber espionage that could destroy the economy and planning cyber war that could cripple national infrastructure. At the same time, hacking tools were now so easy to download and use that even that paper-boy you failed to tip could extract revenge by crippling your home network. I know, I wrote some of those headlines. More scary headlines warned that Facebook, Google+ and the like would destroy our privacy forever. Websites traded information about our online activities in exchange for "free" tools like traffic analytics or a commenting system. Yeah, I wrote some of those headlines too. But you know what? People didn't give a toss. They just got on with using the internet for increasingly complex tasks and with increasing confidence. Abstract privacy threats didn't prevent Facebook growing to 800 million users and more. Professional social network LinkedIn committed the odd privacy outrage, but once the Twitterstorm faded it was business as usual. Sony exposed the account details of 77 million PlayStation Network customers, but the main complaint from customers was that they couldn't play their games on the Easter long weekend. Cyber crime costs Australia $4.6 billion a year, we were told. But that's only about $200 a head. Call it $4 a week. That's friction, not catastrophe. Caroline Pearce, head of fraud, risk and compliance for the Australian Payments Clearing Association, told last month's eCrime Symposium that fraudulent transactions account for just six cents in every hundred dollars. Sounds like we've actually got everything under control. Indeed, Silicon Valley is booming right now, with demand for internet-savvy programmers at levels not seen since the late 1990s. As 2012 unfolds, the war on the internet will escalate. The pace won't be "internet speed", since it's fought in the traditional venues of diplomacy, parliaments and courts. Much of the action will be skirmishes continued from 2011 or earlier. The copyright infringement case against iiNet, which began in 2008, will finally conclude when the High Court hands down its appeal judgment. Legislation enabling Australia to join Council of Europe Convention on Cybercrime will pass its final hurdle in the Senate -- maybe amended, maybe not. Meanwhile businesses will continue to make use of the increasingly sophisticated online tools available for "free", paid for with their customers' privacy. They'll tap into the global market for supplies, labour and customers. The digital economy will keep on growing. They'll be the winners. Eventually the media will focus on those winners, rather than the whingeing of the established losers. But I wouldn't put my money on that happening in the coming year. We're still mid-game.