THERE's $1 million at stake in a competition being run by an online DVD rental firm. If you are thinking of entering, you might want to take note of an analysis by two computer scientists which has revealed a loophole that could be used as a cheat's charter.

Netflix, based in Los Gatos, California, is offering the prize to the first person who can achieve a 10 per cent improvement in the system it uses to recommend movies to its customers. The competition has already attracted more than 11,000 teams.

The existing recommendation service predicts what movies users will enjoy based on how they have rated films in the past. Netflix has now released movie ratings from almost half a million users, along with when they watched them - but it has withheld users' names and some of each user's ratings. Competitors have to predict what these hidden ratings are. ...