[dragonwriter]

> It's a death spiral waiting to happen.

Probably not.

> Companies will move away from areas where their employees can't get hosting.

And if that happens in even a small degree, housing prices will drop, relieving the problem. It's only a problem if their is a sharply threshold where below which no one moves out, but just above which lots of companies do. That's not entirely implausible, but it's not all that probable.

> Not many have to move before the rest start to follow

That right there is the highly speculative part; if it's true, you have an out of control positive feedback loop, but otherwise it's a self-controlling negative feedback loop.