[vaibkv]

Why don't you try and read some research papers on this topic and then decide how you would want to build your algorithm? Some links -

http://static.googleusercontent.com/media/research.google.co...

http://insight-centre.org/sites/default/files/publications/1...

http://users.cis.fiu.edu/~taoli/pub/p125-li-sigir2011.pdf

http://arxiv.org/pdf/1303.0665v2.pdf

http://scholarworks.sjsu.edu/cgi/viewcontent.cgi?article=129...

https://www.ntnu.no/wiki/download/attachments/71733389/WEBIS...

A chapter dedicated to the subject -

http://infolab.stanford.edu/~ullman/mmds/ch9.pdf

[psyklic]

Here are a few more applied papers/articles:

+ Hulu: http://tech.hulu.com/blog/2011/09/19/recommendation-system/

+ Amazon: http://www.cs.umd.edu/~samir/498/Amazon-Recommendations.pdf

+ Spotify: http://www.slideshare.net/erikbern/collaborative-filtering-a...