If...

[OhNoNotimAgain]

And once index funds demonstrate they can consistently beat active funds what will happen to that sector?

[JohnW]

But they can’t can they? Index funds can only get market returns less costs/friction losses, which leaves the rest of the market returns (and exactly the same returns) for the active investors (from which, costs/friction losses). So they both get the same returns.
But you can have bad and worse indexes, which I suppose gives some succour to the active investors. And the active investors are funds and individuals; you asked about funds, so I suppose active funds could take from active individual investors, thus out-gunning index funds, but not many seem to.

[OhNoNotimAgain]

But they can’t can they? Index funds can only get market returns less costs/friction losses, which leaves the rest of the market returns (and exactly the same returns) for the active investors (from which, costs/friction losses). So they both get the same returns.

But they don't do they?

[JohnW]

Yes, I’d say can’t, don’t and shan’t.

[OhNoNotimAgain]

Yes, I’d say can’t, don’t and shan’t.

Which begs the question of what the market is?