Hollywood is known as the heart of movies, every major and big movie that we know came from Holly Hollywood!
Movies in general didn’t actually starts in Hollywood, actually before 1911, the first movies shot were made in the east coast, then Edison invent a technology to shoot better movies with better quality.
Edison company was basically monopolizing the industry by suing every movie that used its technology, so companies like Paramount and Fox left and went to California, west coast. It was more of running from the legal influence of Edison that it is for Hollywood, however, California in general offered a very cheap and diversity in the landscape that helped the production of movies. So Technically, every movie made before 1917 outside of Edison production company was completely illegal.
When started being made in Hollywood with no law constriction, the big production companies were really the one monopolizing the industry, they were controlling everything from production, distribution till owning cinemas. Directors and actors had to sign contract that only let them work with that production company alone,
Then TV came to the screen, which effected the cinemas income and the attendance percentage went down from almost 90% to 10%, this is when the production companies had to level up and create something huge.
Production companies started giving more freedom to film makers which helped in creating more innovative movies, this is the era of God Father. However, film makers took it sometimes too far, budget were too big that sometimes led to bankruptcy of production companies. Movies were made but nothing is coming in return, them Modern Hollywood came along.
This is Hollywood as we know today, distribution is way different now with Netflix and Amazon, and movies like The Avengers or Iron Man series are the one deserved to be seen in a big screen, also the production went down, everyone now can make a movie.