Yeah it's not like New York hasn't heard of garbage cans, there is just way, way too much of it to work that way.Do you know how many cans a large residential building would need to put out on a garbage night for example? Or a large mixed use building? You gotta remember, NYC is a very vertical city. They would completely block the sidewalks and/or streets for quite a bit of length. Bags can get piled up on top of each other. I think on the more residential areas of the city, where it's mostly townhouses, brownstones and other buildings usually not more than 4-5 stories high, they use cans.
My building has about 50 units. We store garbage in the building and then on garbage days move it all to the curb. It's usually a garbage mountain.