Probably real, yes only Bay Area, and no not the norm for ML.
First of all only a few companies can pay that much (Google, Facebook, LinkedIn, Netflix, etc) and these are outliers. The average ML engineer in the Bay Area does not make 500k/yr total comp.
ML engineer is a programmer usually with a BS in CS, sometimes a MS. They are, in the end, only an engineer.
The AI scientists, those with work in computer vision, natural language, and audio, developing novel networks and training methods, make at least $500K/year. I've been a data scientist and the pay (and work content) was a joke. I switched to AI and damn, work makes you think and you get paid like a mid-range NBA star.
I went back for a PhD. I know a lot of people can't do this, but this is the reason why there are few AI specialists. You just can't become an expert by reading blogs and even research papers online. You need the full specialist environment, from discussions outside the bathroom to the drawings on the whiteboard.
And here I am dreaming of achieving it by doing MOOC courses :)...So, not possible at all this way?
Theoretically, one would feel, that by just reading blogs, watching videos along side taking MOOC courses, and spawning GPUs on the cloud, should do it.
