Aside from this, even if the teams are able to improve the algorithm tremendously, Netflix is looking for the wrong solution. The ability to predict that, say,

Aside from this, even if the teams are able to improve the algorithm tremendously, Netflix is looking for the wrong solution. The ability to predict that, say, movie ABC would score a 3 from customer X really isn't very helpful for anything. As a Netflix customer, I want them to suggest things that I'm likely to rate 5, and perhaps to warn me away from things that I'd consider a 1 or 2. I want to ignore 3 and 4 movies, so it doesn't matter if the algorithm can predict them well. It also doesn't matter alot if it is able to ferret out every possible 5; as long as it gets a substantial portion, everything is great. I played a bit with this contest when it first started, along with a friend. In just one night, I was able to beat Netflix's own algorithm by enough to get us onto the leaderboard (temporarily). And the algorithm I used was nothing fancy, just correct scaling and normalizing using means and standard deviations: high school math. Unfortunately, neither of us knew anything about algorithms for collaborative filtering, so we quickly reached a plateau.