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I am thinking of starting a project which is based on recommandation system. I need to improve myself at this area which looks like a hot topic on the web side. Also wondering what is the algorithm lastfm, grooveshark, pandora using for their recommendation system. If you know any book, site or any resource for this kind of algorithms please inform.
Have a look at Collaborative filtering or Recommender systems.
One simple algorithm is Slope One.