[jhbadger]

The Valley and SF are different, despite being near each other. The Valley, as you say, started as a chip manufacturing hub and has transitioned over to software and services now that manufacturing mostly gone to Asia. SF is different. While it indeed started (as did NYC) as a shipping port, it has more recent history as a center of creative workers such as authors and artists. The reason that many Internet companies are located now in SF rather than the valley is that they (and the workers they want to attract) want to suggest that their work is cool and creative like that of authors and artists. Of course, an unfortunate side effect of this is making the city even more expensive and displacing the creative people that made the city "cool" to start with.