What is so special about Apple and Seattle that notably that company should open an office in that city?
True, though they are rising rapidly: http://seattletimes.com/html/localnews/2021673014_rentincrea... .
Seattle has had a better response than San Francisco's: http://www.citylab.com/housing/2013/10/san-francisco-exodus/... ("Over the past two decades, San Francisco has produced an average of 1,500 new housing units per year. Compare this with Seattle (another 19th century industrial city that now has a tech economy), which has produced about 3,000 units per year over the same time period (and remember it's starting from a smaller overall population base)"), but it is still subject to many of the dysfunctional political-economic-legal beliefs described in The Rent Is Too Damn High: http://www.amazon.com/dp/B0078XGJXO.
It's worth noting too that Seattle and Washington don't have income taxes, which can be a substantial issue for many tech workers.
This, combined with the substantially lower cost-of-entry on home buying are the main things keeping me in Seattle. In particular the income tax means that even a substantial bump in the number at the top of my paystub doesn't necessarily translate into a bump at the bottom, and it certainly doesn't after I look at what it would cost me to buy a home in a part of San Francisco similar to the condo I own here in Seattle. There's also the commute: right now I have a ~15 minute drive to work compared with the ~one hour (I think, roughly? I've only done it a few times when visiting) it takes to get from downtown SF to the Googleplex.
One of the nicer bits (in my opinion anyway; I know it's not shared by everyone) about the new housing going up in Seattle is that it's mostly replacing one-story retail with multi-story retail+residential, and they've incentivized developers to preserve the facades (street feel) of the original buildings with new interiors that are up to code w.r.t. earthquakes, etc. Yes, the buildings are bland and the apartments in them are expensive and sterile, but if it can get ahead of the influx of engineers coming into Amazon we might stem the tide of rising rents in older residential properties in the area.
It's potentially the largest hub of independent mac/iOS developers outside of the valley. Seattle Xcoders is a bit of an institution and has been very active for a long time. Omni Group, Black Pixel, Flying Meat, Aged and Distilled, Q Branch (1/3rd of it) are all here. So there is justification for this specific pairing, though it wasn't explicitly mentioned in the article.
I think it's quite smart to put all software engineering in one physical location. Physical distance kills cooperation so badly :/.
Unless you're going to a river that is
That said, I think my point still stands: Seattle (and apparently New York) have good representation from the other what I'll (I suppose somewhat arrogantly) call 'tier one' tech companies. Most cities, even those with strong tech employment, don't have remote offices for the other large players. One could argue that this is simply because they haven't gotten around to it yet, but it's also a point in favor of the notion that there isn't a sufficient concentration of developers who are both (a) at the level the companies are looking for and at least as importantly (b) are willing to work for one of the big players.
Elsewhere someone pointed out that there are smart people everywhere. I don't dispute that in the slightest. I also expect there are people who want to work for Apple, Google, Amazon, Facebook, etc. everywhere (and who are unwilling to move to the places where those companies are). I'm not certain that the intersection has a high enough density in, say, Atlanta (which has rather a lot of software engineering) to justify a remote office there. NY and Seattle have already demonstrated that they have a sufficiently high density in the intersection via an existence proof: a half dozen other tier one tech companies operate large successful remote offices in these cities.
Less competition too...
Google as Example has large a HQ in Zurich, Microsoft as explained above in Munich.
This Blogpost seems to me to be a call for more decentralized operations in engineering.