Monday, September 21, 2009

Another Approach to Outsourcing

When Netflix decided that they wanted to invest in improving its software that recommends movies to users, it could have done the work internally or hired an outside software development firm. It decided to do neither, instead opting to offer a $1 million prize in October 2006 to anyone who could submit a solution that improved its current system by at least 10% (if multiple submissions beat the 10% barrier, the winner would be the solution with the greatest increase).

The contest drew over 51,000 contestants from 186 countries. Netflix just awarded the $1 million to a team consisting of two researchers at AT&T Inc., two engineers from Montreal, a research scientist at Yahoo Inc. and two machine-learning researchers from Austria whose solution improved the current system by 10.9%.

No comments:

Post a Comment