I'm not really convinced cost is the driving force. A lot of tech companies with open-plan offices throw around money pretty lavishly, and programmers feel so strongly about focus that I suspect many would accept a direct offer of "no raises this year, but you all get cubes/offices instead".
If you're taking the whole company on an international vacation, or paying to do their laundry and offer daycare, or offering whatever other widely-mocked perk you care to name, it's hard to imagine that worsening employee experience to cut costs is the goal. (Especially when you see open-plan offices even at non-urban companies.)
I think a lot of people really do believe the hype about open plan being better, especially if they're the boss and don't have to actually experience it.
If there is another force behind this, I’ll take a stab at it and guess it’s conditioning against the idea of privacy.
If you can get a community of people who work together to ignore the basic human idea of privacy by cramming people together such that they are forced to live out in the open without privacy, it then becomes easier for them to ignore questions about privacy when creating privacy violating services.
Big successful new companies started out scraping by being built in garages with just a computer, table, chair to use, no private offices. When they grew up they saw no reason to change because it worked for them. So now the company is big and successful and believes that part of its success was the open plan office. So now other companies try to emulate the new young fresh hip fashionable company and so everyone gets open plan, even if its worse than offices.
Why not? They're following the fashion of minimalism, first in their hardware and software styling and now in their offices. They're making their workplace look like they aspire their software to be, even if its to the detriment to the users.
Fashion certainly seems like an explanation for a lot of what Apple does. Whether it's selling thin phones while knowing they bend, insisting on a metal unibody that drops calls, or converting to an 'elegant' touchbar for function keys that cripple usability, it's not hard to find bad decisions made for style reasons.
Apple's definitely following fashion to the point of self-harm, but Apple started in a garage but then had offices until just recently and were kicking ass that way.
If you're taking the whole company on an international vacation, or paying to do their laundry and offer daycare, or offering whatever other widely-mocked perk you care to name, it's hard to imagine that worsening employee experience to cut costs is the goal. (Especially when you see open-plan offices even at non-urban companies.)
I think a lot of people really do believe the hype about open plan being better, especially if they're the boss and don't have to actually experience it.