The New York Times has a long piece about Pandora and the possible impact of recommendation systems on the music business.
The story says: "At pandora.com visitors are invited to enter the name of their favorite artist or song and to get in return a stream of music with similar 'DNA,' in effect a private Internet radio station microtailored to each user's tastes."
I just assumed that 'DNA' came from other users' preferences (if you like that, you'll like this) which has been the usual approach since MIT's Firefly started a decade ago. However, Pandora has musicians such as Seth Ford-Young working on the real content of the music.
As he listens, in a room not far from an elevated stage with drums, guitars and amps for employee jam sessions, Mr. Ford-Young fills out a scorecard on which he can rate hundreds of traits in each song on a five-point scale. Bit by bit, Pandora's music analysts have built a massive archive of data, cataloging the minute characteristics of more than 500,000 songs, from alt-country to bossa nova to metal to gospel, for what is known as the Music Genome Project.
Comment: Technically, Pandora is US only, but if you haven't tried it, I recommend it highly. You can see the sort of things entered in the database by looking up a track, eg Pink Floyd's Time.
The UK site Last.fm is a "social recommender" system, and uses "collaborative filtering".