K-Nearest Neighbor, Single Value Decomposition & Support Vector Machines!
Do these terms scare you! Fear not - Captain Depraved & Wikipedia to the rescue,
these are clustering algorithms which make use of Machine Learning, the idea is to have a machine
guess based on a large data set, a lot like how experienced human beings make predictions, only this is by a machine working off data.
Simon Funk - has this wonderful article explaining, the Netflix prize, his approach and also a couple of the above mentioned algorithms/methods.
If you'd like to know how the Netflix recommendation system works currently - head over here.
To get a visual on the idea check this applet.
If you are interested in reading more, there are more posts from other Netflix competitors here and here.
If you want to get your hands dirty, there is always Weka - Happy Clustering Folks!
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