You're right, the real reason is the high density of companies and the talent they attract to the Bay Area. My point with cost of living was that companies need to pay $(CoL + X + Y) for people to be willing to move out here. Where X is whatever they need to pay to entice the employee away from the other companies. And Y is the amount of savings/discretionary spending the employee wants to have.
I always wondered why the FAANG companies don't move their main campuses to somewhere with a lower CoL (call it CoL') so they only need to pay $(CoL' + X' + Y) to keep the employee. Paying X' (where X' probably less than X) because they're no longer in local competition with the other companies. I wonder how long it would take to recoup the cost of moving the company in savings on compensation. There are countless places which have better quality of life than the Bay Area, while also having lower CoL. I chose to move to the Bay Area because Y was greater than what I could get anywhere else.
I always wondered why the FAANG companies don't move their main campuses to somewhere with a lower CoL (call it CoL') so they only need to pay $(CoL' + X' + Y) to keep the employee. Paying X' (where X' probably less than X) because they're no longer in local competition with the other companies. I wonder how long it would take to recoup the cost of moving the company in savings on compensation. There are countless places which have better quality of life than the Bay Area, while also having lower CoL. I chose to move to the Bay Area because Y was greater than what I could get anywhere else.