Yea the pandemic is overfit as a reason for most things. Production had already left over the preceding decades.

Hollywood didn't lose its relevance overnight. It's been a slow moving process as the film -> digital -> portable transition made production cheaper, the internet made talent cultivation/distribution easier, studios and audiences expanded internationally, unions kept ratcheting up rates, LA refused to build homes while population ballooned, QE/ZIRP/0% rates re-inflated a housing bubble, unions kept raising rates to keep up with housing in LA, internet/social content began competing with studio productions hurting demand, the incestuous hollywood-to-traditional media marketing pipeline died (much of old print/tv media existed to market Hollywood stars and products), etc. etc.