What has yet to be mentioned is why Hollywood, in the first place?
Out of the many reasons, one is quite simple: daylight. This used to be really important with film.
Historically, this was why efforts to move filming to somewhere like 'Scunthorpe, UK' didn't really work, despite tax fiddles, because you need light and some places just don't have it.
But this doesn't matter now, because film has moved on, there is no need to have a massive glowing unshielded nuclear fusion reactor, 93 million miles directly overhead, just to get some lens focused on some bits of silver halide.
I too have experienced the light of Scunthorpe. ‘The skies reflect our labours’ as they say ;)
Why Hollywood?
Because Edison and Patents in New York which was the original centre for filmmaking in America.
https://en.wikipedia.org/wiki/Motion_Picture_Patents_Company...
My understanding is that an important consideration at the time was that it is very far from New Jersey.
Edison had a lot of early patents for film, and wanted to monopolize the industry.
Film makers in California were far enough away that it was inconvenient for Edison to sue them, both because it required sending people there in person, and because the district courts were favorable.