IMHO, Diller (and the article) conflate a number of disparate things. To him, to the "industry", they've lumped these things together because that's how it always had been...however for anyone sufficiently "outside" that industry, what has occurred was inevitable: the movie industry used to be content creation -AND- presentation, but presentation got eaten by technology. And we're well on the path that creation shall be too.
When I was kid, almost a half century ago, going to a theater (even a drive-in), was "an event". However, today, the event experience SUCKS. And it has, for over 20 years. It wasn't COVID that killed it, that was just the last bit of dirt shoveled onto the grave. It had been dead for over decade, thanks to greedy studios and the advancements of big screen TVs. When I sat three feet from my first 42-inch LCD, whereby I could pause when I wanted to grab snacks at "wholesale" prices, pee when I wanted, rewind to see that last bit of action again... I knew theaters were done. The screen was relatively the same size, it looked better, it sounded better, I could fart loudly whenever, and there wasn't those punk kids three rows back talking through the whole thing. From then on, I only went to theaters when I -had- to, thanks to the studio "model", and pirated as many first-run movies as I could. My experience at home was better. WAAAAY better. Sorry studios, you f'd up.
But the other side of the coin is quickly coming face up soon too... folks have the power in an iPhone or iPad to destroy Hollywood. They just need to do it. I mean, yes, we've had that power for well over a decade, longer even. But... now they really have it. Everyone. The only thing the studio model has is the I.P., the Marvel and LucasFilm properties. And you can be sure they'll flail those horses until they're well past death. Reincarnated. Flailed. And Reincarnated again. But we don't watch Laurel and Hardy anymore; we'll eventually tire of X-Men and Avengers just the same. Even Luke, Leia, Han, and Chewy. There are lived experiences all around us, we just need to be the ones who start telling our own tales.
Which brings me to the Future: this isn't all bad, because we're on the cusp of the Next Big Thing! That will be VR. Anyone with eyes should "see" that. With VR, movie theaters are... well... nothing. They're garbage. Every good thing about theaters can be done better with VR. Everything. And VR -is- coming.