Netflix Offers $1M Prize2 Oct, 2006 By: Jessica Wolf
Netflix is betting $1 million that there's a way to upgrade its patented recommendation technology on the online DVD rental site.
The company has announced the Netflix Prize, a $1 million award that will go to the first person or group who raises the accuracy bar on the company's recommendation process.
“Recommendation systems covering a wide variety of categories will play an increasingly significant commercial role in the future," said Reed Hastings, Netflix co-founder, chairman and CEO. "Right now, we're driving the Model T version of what is possible. We want to build a Ferrari and establishing the Netflix Prize is a first step."
One of the most popular and touted parts of Netflix's groundbreaking online rental service has been its recommendation angle. Users rate movies and, based on user-generated profiles, Netflix's software matches potential viewers up with films they may like.
Netflix will publish a detailed description of the winning improvement for the benefit of companies, entrepreneurs and academicians.
The threshold required to win the Netflix Prize is a 10% improvement in accuracy over the current Netflix recommendation system. If no one wins the grand prize this year, the company said it will award a $50,000 progress prize to whoever makes the most significant advancement toward the goal and will award a progress prize annually until someone wins the grand prize.
Netflix has removed any identifying or personal consumer information from the data set released for contestants in the prize. They will have access to movie titles, star ratings and dates.