Any software gurus out there?

Online DVD rental company Netflix Inc on Sunday announced that it would pay $1 million to the first person to develop software to improve the accuracy of Netflix's movie recommendation system by 10 percent.

Netflix's Web-based recommendation system "learns" what kinds of films subscribers like by asking them to rate the films they watch. The system then recommends lists of similar titles, unique to each user.

Netflix Chairman and Chief Executive Reed Hastings, who made his fortune designing software, predicted that Web-based recommendation systems would play "an increasingly significant commercial role in the future."

"Right now, we're driving the Model-T version of what is possible," Hastings said in a statement announcing the price. "We want to build a Ferrari, and establishing the Netflix Prize is the next step."

The winning software designer must improve the accuracy of Netflix's current rating system by 10 percent. The system is composed of more than 1 billion ratings, in which subscribers use one to five stars to describe how much they liked a film.

The Netflix system uses those ratings to "predict" how many stars a consumer would assign to each of the 65,000 titles in its library.

The current system comes within one star of accurately predicting a consumer's true feelings about a film, and the company wants to cut that margin by one-quarter of a star, Jim Bennett, vice president of recommendation systems, said.

"If we can guess the really great ones for you and the ones you really abhor ... we can really choose the four- and five-star movies that people want," Bennett said.

If there is no winner, the company will award a $50,000 "progress" prize to the designer who makes the most significant advancement toward the goal.

Netflix will continue awarding the progress prize annually until someone wins the grand prize of $1 million, the company said.

The prize was modeled on the Longitude Prize, offered by the British government in 1714 to the inventor who could determine a ship's longitude during transoceanic travel.

John Harrison won the prize in 1761.