San Francisco - Online movie rental firm Netflix has handed out a million-dollar prize to a team of engineers and statisticians who met the challenge of improving the company's movie recommendation engine by more than 10 per cent.

Using a combination of algorithms, the seven technology professionals from Austria, Canada, Israel and the United States succeeded in notching up a 10.6-per-cent improvement.

It took the BellKor Pragmatic Chaos team over three years to reach the goal, and they submitted their proposal just 20 minutes before a rival team called The Ensemble offered up an alternative solution that also promised a 10.6-per-cent improvement.

Netflix CEO Reed Hastings said Monday that the company "got very lucky" in that the 10-per-cent threshold for improvement was "just hard enough" to challenge even the most knowledgeable engineer or researcher.

But he revealed that the next prize would have a time limit, with 500,000 dollars going to the team that makes the most progress by April 2010, with another 500,000 dollars awarded to the leading team in April 2011. dpa