Your localized analysis of labor markets is like trying to judge global climate by the weather in your backyard.
Immigration policy is a national policy and it must be evaluated on a national level.
"If the cost goes down, why would the demand remain fixed?"
Do you have evidence that demand for these people is increasing? The author of the article doesn't seem to think so. Slashdot has been filled with stories over the last couple of years of firms laying off tech workers and forcing those workers to train their replacements.
If demand for this talent was increasing, salaries would be rising across the industry and very few firms would be laying off workers. Why would you layoff anyone if you can't meet your demand for employees?
H1B is a cost saving measure at the expense of the American worker. Anyone who thinks otherwise is being willfully ignorant of the situation.