[kspaans]

There could be other reasons too, like infrastructure. You probably can't house a dev team in a small town far away from a major city where the internet is slower. (To name just one type of infrastructure.)

Or perhaps it's human capital that can't be moved: customers and devs need to be close, so putting the devs on a cheap tropical island with a good fibre connection won't cut it.

[knughit]

Kansas City has gigabit, yet Silicon Valley still exists, so inter et connectivity isn't the major factor.