US online DVD rental service Netflix Inc has announced a version of the Longitude prize for film geeks - a $1m (£529.6m) bounty to the first person to develop software to improve its movie recommendation system by 10%.
Currently, the system "learns" the individual taste of each of Netflix's 5.2m subscribers by asking them to rate the films they watch. This data is then used to generate a list of suggestions or "recommendations", unique to each user.
To win Netflix's prize, the software program must demonstrably improve upon the current movie-recommendation system by at least 10%. The differences will be tracked by a program that quantifies how well the recommendation systems predict which movies will be liked or disliked by a profiled consumer.
If no one wins the grand prize this year, Netflix says it will award a $50,000 (£26,000) progress prize to whoever makes the most significant advancement toward the goal. It will award a progress prize annually until someone wins the grand prize. The prize is reportedly modelled on the Longitude prize, offered by the British government in 1714 to the inventor who could determine a ship's longitude during transoceanic travel. John Harrison eventually won the prize in 1761.
The bounty is part of Netflix's effort to sharpen its competitive edge as it continues a bitter duel with Blockbuster Inc and prepares for an anticipated onslaught of services that make it easier to download movies on to computer hard drives.
The winner will be free to license the program to other websites such as Amazon.com that make product recommendations to their visitors. Recommendation software is expected to play an increasingly important role in electronic commerce as internet companies expand their databases of past consumer behaviour. Netflix has already learned a lot about DVD tastes, having gathered 1.5bn movie ratings from about 10m consumers who have subscribed to its service at some point in its seven-year history.