Telling You What You Like

This Los Angeles Times article regarding recommendations has a quote from Mike Kaltschnee, author of the Hacking Netflix blog.:

Online movie rental company Netflix Inc., for example, lets its customers write movie reviews. Netflix subscribers also can invite one another to become "friends" and make movie recommendations, peek at one another's rental lists and see how other subscribers have rated other movies.

Combining all these tools has helped make Netflix recommendations more in tune with subscribers' tastes, said Neil Hunt, Netflix's chief engineer.

To gauge how well Netflix does, the company compared how well customers liked the recommended movies with how well they liked movies that were picked from a list of recent releases, many of which were heavily marketed upon their release on DVD. On a five-star scale, movies recommended by Netflix scored half a star higher.

"If you spend $50 to $100 million promoting a movie, you can persuade a lot of people to watch it," Hunt said. "But if a movie stands on its own merit and matches an individual's tastes, they may enjoy it a lot more."

"This is really powerful," said Netflix subscriber Mike Kaltschnee, a 40-year-old vice president for a stock photo agency in Danbury, Conn. "There are 45,000 movies in the Netflix collection. This helps me find the good ones. Before, my taste was limited to what I happened to see at the local rental store. Now I rent foreign films, like 'Whale Rider.' I never would have rented that before. Not in a million years."