I have been following the "reccomendation algos as a service" for about 2 years now. This definetely seems interesting but a side opportunity could be to do aggregator/optimizer of recco algos for merchant/publishers similar to what Rubicon Project/Pubmatic does on aggregating/optimizing ad networks.
The reccoAlgo aggregatot would take all the various recco algo services such as DirectedEdge, Aggregate Knowledge, Loomia, Minekey, Persai (now dead) and many others and keep running tests (similar to the netflix prize) and whatever is better is given more airtime on suggesting related products/pages for retailers/publishers.
The compensation model would work on a percentage of revenue for additional clicks/purchases on the suggestions.
The reccoAlgo aggregatot would take all the various recco algo services such as DirectedEdge, Aggregate Knowledge, Loomia, Minekey, Persai (now dead) and many others and keep running tests (similar to the netflix prize) and whatever is better is given more airtime on suggesting related products/pages for retailers/publishers. The compensation model would work on a percentage of revenue for additional clicks/purchases on the suggestions.