Not yet. But according to this, For Tech Start-Ups, New York Has Increasing Allure – NYTimes.com, there are more and more startups taking off in NYC. While I can’t see the Valley fading away, I could see it having to compete for talent with NY. Whatever is said, where the work goes depends on where the talent is going to school and where the money is. I can’t see places like San Mateo or Palo Alto or Cupertino losing that for some time. However NYC has money and talent too. New York, and Brooklyn in particular, is hot again. The article doesn’t mention that, which is suprising, but if I were young I think Brooklyn could be the place to relocate to.
So yeah, not going to replace, but definitely going to compete.