Monday: The Good: What went right in Seattle tech in 2008.

Tuesday: The Bad and Ugly: Where things went wrong, and how they got worse from there.

Wednesday: What to watch in Seattle tech in the year ahead.

The ongoing financial meltdown has the tech sector on its heels, with layoffs and other cutbacks dominating the headlines as 2008 draws to a close. The economic turmoil defined the year, and perhaps the era.

But even without those problems, many Seattle tech companies did just fine screwing things up on their own.

In fact, the past year was like a soap opera. It started with the local software giant's ill-fated bid for one of its biggest rivals. Later we had two executives at a local startup admitting to concocting the financial statements presented to their board. Now we have allegations that another local startup is wrongfully keeping hundreds of thousands of dollars from youth sports programs around the country.

Not to mention those weird Bill Gates and Jerry Seinfeld ads.

And the bison slayings.

Seems like only question at this point is who gets the movie rights. So brace yourself: Here's our review of The Bad and The Ugly in Seattle technology in the past year.

MICROSOFT-YAHOO: This was one of the biggest stories of the year in the technology industry, but it ultimately resulted in nothing but a headache for all the companies involved. Microsoft's $45 billion acquisition bid for Yahoo quickly devolved into a soap opera that, months later, forced Steve Ballmer & Co. to walk away from the situation entirely.

Well, maybe not entirely. There's still a chance that Microsoft could pull off a search deal with Yahoo. But in the meantime, the Redmond company has fallen even further behind Google in the Internet search market, and Yahoo has been further weakened. One potential silver lining for Microsoft: The situation ultimately may have resulted in heightened antitrust scrutiny of Google.

PUBLIC OFFERINGS: It was an absolutely bleak year for initial public offerings. Not one company from Washington state went public, a big goose egg that is surely causing concern in the conference rooms of Seattle venture capital firms. Not that the previous year was anything to write home about: Only one Seattle-area company -- Kirkland-based Clearwire -- ventured onto the Nasdaq in 2007.

Nationally, only 43 companies completed IPOs this year, a decrease of 84 percent compared to 2007, according to IPOHome.com. And with the economic troubles continuing to mount, it doesn't look good ahead. Seventy-two percent of venture capitalists said in a recent survey by the National Venture Capital Association that they don't expect the IPO market to open until 2010 or later.

VISTA CAPABLE: Oh, how Microsoft executives love their email, and their prolific missives came back to bite the company yet again this year with a series of messages revealing the sausage-making that was the Windows Vista development process.

First the messages showed Microsoft executives privately grousing about their problems running Windows Vista even as the company was talking publicly as if Vista were the Second Coming of Windows 95. Then came messages showing how Intel's profit concerns influenced Microsoft's decision to lower the standards for the "Windows Vista Capable" designation. In the process, we got a glimpse of Microsoft ignoring a paid consultant's advice and ticking off PC giant Hewlett-Packard.

The kicker: The case is still ongoing.

IMPERIUM: Perhaps no Seattle startup has encountered as much of a change in fortune as Imperium Renewables. In 2007, the Seattle biodiesel producer raised more than $200 million, filed for an initial public offering and opened a 100 million gallon refinery in Grays Harbor that was applauded by the state's political establishment. This year, things changed. Dramatically.

At the start of the year, the one-time high flyer pulled the plug on $345 million IPO. A week later it laid off a large chunk of the staff, with one former employee suing the company over compensation issues a few months later. To make matters worse, Imperium lost a key contract with Royal Caribbean Cruise Lines in August just as oil prices started to plummet. It was even fined $20,000 by the state's Department of Ecology for an oil spill in the Duwamish River from last year.

By October, when the company finally announced a recapitalization plan, founder John Plaza indicated that the business was under "stress." Given all that happened in the past year, stress might be an understatement. The company is still hanging in there, so if the current management can right the ship, we will have one heck of a turnaround story on our hands.

WINDOWS ADS: Microsoft's I'm a PC commercials surprised people by using Apple's slogan to their own advantage, but the company's $300 million Windows ad campaign will forever be remembered for three things: Bill Gates, Jerry Seinfeld and Churros.

COUNT ME IN: Little league baseball programs, soccer clubs, junior ski programs and other youth sports organizations across the country were left scratching their heads (and digging into their cash reserves) earlier this month after word spread on TechFlash and other publications that Count Me In wasn't meeting its obligations. The Bellevue company, which handles online registrations for hundreds of non profits, ran into financial troubles. A New Jersey soccer club sued the company in early November for failing to remit $142,000 in registration fees, but that was just the tip of the iceberg. We've tracked more than $1.4 million in missing funds.

Count Me In Chief Executive Terry Drayton -- who appeared on the cover of the latest issue of Seattle Business Monthly -- has said repeatedly that he's working to resolve the situation. Meanwhile, youth sports programs continue to wonder what happened to their registration fees. We continue to track the case, which is one of the more perplexing stories we've encountered.

ENTELLIUM: In one of the more spectacular blow-ups at a venture-backed company in recent memory, the top two executives at Entellium pleaded guilty to cooking the books at the Seattle software company. Former CEO Paul Johnston is now facing four to five years in prison, while former CFO Parrish Jones is looking at 33 to 41 months.

The story captivated the tight-knit Seattle tech community, especially after we reported that the company 's auditors never completed audits and that Intuit was positioning to buy the company's assets out of bankruptcy. Along the way, current and former employees expressed anger and dismay over the situation, making it one of the most discussed topics of the year on TechFlash.

Most amazing is that four months ago Entellium looked to be a healthy business with more than 125 employees and prominent venture backers such as Ignition Partners and Sigma Partners offering support to the tune of $50 million. This one won't easily be forgotten.

CASHBACK: Weeks after Microsoft touted the progress of its Live Search Cashback shopping refund site, the company found itself in the middle of a debacle when Cashback crashed on the day after Thanksgiving, one of the biggest shopping days of the year.

The outage lasted most of the day and kept many people from receiving the 40 percent discounts that Hewlett-Packard had offered via the Cashback service. And many of those who did get through initially got not the promised 40 percent but rather 3 percent instead. Ultimately those accounts were adjusted, but  Microsoft and HP were forced to acknowledge that they wouldn't be rerunning the promotion, despite an earlier promise to that effect by a Microsoft representative.

Not exactly a smooth move for a company trying to dig itself out from less than 10 percent of the market.

BISON SLAYING: Attachmate Chief Executive Jeff Hawn found himself in a heap of trouble earlier this year after organizing a hunt in Colorado that ultimately ended with 32 bison from a neighbor's ranch being slaughtered. The case gained national attention, in part because it pitted values of the "new west" versus the open range laws of the "old west." In the end, Hawn -- who was upset that the bison had defecated on his land, destroyed fences and knocked satellite TV dishes offline -- lost.

Last month, Hawn pleaded guilty to charges of animal cruelty. The software executive -- who has homes in Texas and Colorado but runs Seattle-based Attachmate --  faces probation, 10 days in jail and a fine.