Disney and its rivals star in a real-life disaster movie

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THE EMPTY freeways of Los Angeles look like a scene from a disaster movie. For many Hollywood bosses, that is how things feel. With one in three people in the world subject to social-distancing rules, boxoffice takings in 2020 have collapsed. Television is bracing for revenue-starved advertisers to rein in spending. Shooting on productions slated for 2021 has ceased, portending an unpleasant sequel next year.

Covid-19 comes at a tumultuous time for show business. A five-year, $650bn investment binge was already reshaping it for the age of video-streaming. Debts taken on by giant media groups such as AT&T, Comcast, Disney and ViacomCBS—which owe more than $350bn between them—look less sustainable now that their sales have sunk. Even Netflix, whose streaming-only offering is less vulnerable to lockdowns, is not immune. The pandemic will leave scars. It may claim a few victims, too.

Theatrical releases, which studios use to...

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