SF bigger? Not if the current city government has any say, which is a large part of the issue. Why invest in SF with their 16 new units of housing a year when you can just invest in san jose which is increasingly the center of gravity of the bay area, especially the longer the government of SF acts like toddlers?
Its both larger than SF and growing faster than SF. The economy of the bay area is bigger than just software engineering. If this statistic is to be believed, information technology jobs in the bay area only account for 6% of the job market anyhow (1), although they make up the vast majority of the job related headlines for the bay area I am sure.