The fabled Netflix Prize competition is closed although a winner won’t be announced until September. The company offered $1 million to anyone who could most improve their movie recommendation algorythm with a minimum threshhold of 10%. As of the July 26 closing, two teams had exceeded the 10% mark and were neck-and-neck (about 1/1000th of a percentage point acording to the leaderboard).
What does this mean for the rest of us? More movies we like would seem to be the obvious answer. The existing algorythm had been reported to be better than people’s own choices at predicting what movies they would like. A 10% improvement could be significant.
More important, however, is the potential for open source innovation in analytics. Netflix, a relatively small company, was able to tap into a world of talent buy putting its need out in the open market. This assemblage of talent is far greater than they likely could have assembled for an in-house group and brought fresh perspectives as well as raw brain power. No fear of challenging corporate “sacred cows” or cowing to internal politics. These teams need only to focus on the job at hand.
There was quite a ripple effect as well, according to the New York Times:
“It has shaped careers, spawned at least one start-up company and inspired research papers. It has also changed conventional wisdom about the best way to build the automated systems that increasingly help people make online choices about movies, books, clothing, restaurants, news and other goods and services.”
Was the time and money worth it for Netflix. We’ll never know for sure although a repeat of the competition would be a clear indicator that it was. Reed Hastings, Netflix’s CEO, will host a ceremony to name the winner in the fall though he’s sure to keep the talk positive.
Do you think that this open source development could work for your company? Were you on a team in the Netflix Prize competitoin or a similar event? We’d love to hear your thoughts and experiences.
