Employees work for the employer, not the other way around

An "emotional" argument about human artistry isn't irrelevant, it's the entire point. Studio execs are betting they'll be able to make as much or more money by replacing the artifacts of human talent with computer generated artifacts. My worldview entirely precludes the possibility of this being successful because I don't see machines as creative entities, and I view generative AI as just clever autocomplete across a massive possibility space. It's fundamentally restricted to remixing the existing artifacts of human creativity, and anything it does will, by definition, be derivative.

We could have a whole separate discussion about human creativity and whether or not all art is derivative in some sense, but even if that's true the root of art is somewhere in humanity's collective consciousness. The machine will never have that because there's no room for true ingenuity there. It's limited by design to respond to prompts by looking at what has come before. The very nature of this tool is that it is of the past. Humans can look forward, dream, feel, imagine, and think and experience novel things.

What I think it most likely to happen in the short term is a schism of the entertainment market. Mass produced and cheap AI content owned (and prompted) by elite media execs and the already-wealthy. People that are so lacking in creative ability they've convinced themselves that somehow the humans making the artifacts are not the real value. They'll shit out derivative and drab content at breakneck speeds and it'll be "good enough" for the mass market to consume. The people who see Marvel movies for the spectacle will be just fine with this kind of content and it will be enough for these studios to make money and consider it a win. They'll feel very good about themselves for putting thousands (hundreds of thousands?) of people out of jobs. These are the same people who have always viewed the human component of their business as just a cost, and have only been forced by the power of collective bargaining to grant the concessions to the human component that they have.

When the technology becomes common enough / good enough that every studio can fire the creative people and hire minimum wage prompt writers it will result in a flood of meaningless fodder being distributed at even faster rates than we get it today. There will be no real competition between these studios because they'll produce at exactly the same quality as each other, with the only possible distinction being intellectual property (Disney gets to make Marvel sludge, but Netflix gets to make House of Cards sludge.)

With that happening in the mass market space, simultaneously there will be a still very large market for genuine human-created content. The quality difference will be just as visible to this market as it is today: I would pick any A24 film over a Disney or Netflix movie any day. Organizations like A24 who understand the value of the human component will continue to exist, new ones will be created as this problem because more visible, and they'll do just fine. They'll never make the billions that Disney makes but that's okay. They'll make enough to continue to employ humans making content for other humans.

tl;dr corporate greed ruins everything, as usual, and this yet another stage in the enshittification of the world. The best we can do is continue to embrace the small corners of humanity that resist.