Yes, and no. I guess it does for the demographic that's enough satisfied masturbating watching hot girls, at scale it's very profitable for the girls too, but there is still a sizable demographic that really want the in person experience, and these demographics do intersect, the in-person demographic is big and reliable since they've always had access to porn, e-cam, etc. and still opted for the in person experience.
That said, I think we're potentially missing out on a lot of talent that would've been in the business that now have no incentive to join since they can do it from the comfort of their home, without all the risks, particularly legal and health risks. Don't forget cam shows and porn are 100% legal it's a huge recruiting factor for onlyfans and such.