Cross-entropy measures prediction quality by comparing a model’s predicted probability distribution with observed outcomes. Out-of-sample cross-entropy can improve while the intended business metric stagnates, so it is not automatically a sufficient optimization target. section 7.1.1
Video recommendation
A model predicts P{swipe} from video features, then ranks videos by predicted swipe probability. Early improvements in out-of-sample cross-entropy coincide with higher DAU, but later improvements produce diminishing gains and eventually no DAU improvement. The engineering failure is optimizing the generic prediction metric without validating its connection to the business outcome. section 7.1.1
Figure 7.1 As the quality of the predictions, P{swipe}, produced by your ML model increases, the DAU increases, too, but at an ever-slower rate.
Shows prediction quality improving while DAU rises at an increasingly slower rate. section 7.1.1


















