Diversity in fiction isn't necessarily just about making a better read for you. It's about making a story mean something to someone by making it relatable. It's a simple construct really. Say you're a black teenage girl who has been told by her parents that she can't get anywhere in the world, or told by society she is worth less than her male counterparts. You watch a fascinating TV series featuring the main character as a savvy, intelligent black female CEO. All of a sudden you have a hero to believe in and a goal to strive for and a picture in your head that tells you "I can be just like her."
When we don't have diversity in fiction, we see a very sad trend of young people who have no heroes, or worse have heroes they don't ever believe they can strive to be. When every little boy wants to be Captain America, the little black boys, as they encounter racism throughout their life, start to believe they can never be Captain America. They are relegated to the depressing sidekickesque role of Nick Fury, if they're lucky. Girls only get to be fifties wife Black Widow whose only action of importance was to help a white male scientist stop his own machine from letting the world end, while yet another white male drove a nuclear weapon up into the wormhole in a blaze of glory.
We don't just need diversity in fiction, we need MAIN characters to be more diverse. If all the heroes are white males, even ones who experience hardship, then only one group grows up with a role model to whom they can really feel a connection, and even those who have a connection with side characters grow up believing side-kick is the best they'll ever do.
I do not think it means what they think it means.
Racial and ethnic diversity is already on the rise in fiction, in all media. What's on the decline is actual diversity of characters and stories. Much of that has to do with more and more new scenarios being exhausted, much with more mediocre authors emerging, much with audiences ignoring sensitive topics. However, another big factor may be the tokenization of minority characters. Race is a whole new dimension to broaden a character, as is just about any other minority designation, but authors all too often simply bring it up and then don't build on it fully, let alone build up other character traits along with it. Besides, way more than enough dimensions exist to broaden hundreds of characters in a common story without the inclusion of "protected" minorities (take Doctor Who or Touhou).