My (very limited) understanding is the selection process is within 8 week period (it can be less than that) for the
Skilled Independent (subclass 189).
No, the selection is not once a year (to the best of my knowledge).
Yes, the selection is based on points. You gain points similar to the Canadian FSW system (English proficiency, skills assessment, etc, etc).
The processing time is approximately 12 months. Refer to,
Skilled Migration Visa Processing Times.
The steps are listed at the Australia SkillSelect site. For the
Skilled Independent (subclass 189) visa visa the information can be found here:
http://www.immi.gov.au/skills/skillselect/index/visas/subclass-189/
The very first step is determining which visa you want to apply for (I have only indicated the
Skilled Independent (subclass 189) visa as an example, it is the most comparable to the Canadian FSW PR), there are several other visa that you may want to consider.
If you are indeed focusing on
Skilled Independent (subclass 189) visa, the first step is visiting the
Skilled Independent (subclass 189) for detailes regarding the visa.
Please also read
Booklet 6 (PDF book, 44 pages, titled "
Points Based Skilled Migration (subclasses 189, 190 and 489) visa")