This is not always true. There are some rare gems like my current place of employment who's managing partners, with a little persuading, allowed me to give raises up to 20% for some individuals.
EDIT: But yes, for most people and most companies, you'll need to jump ship to jump up a rung or two on the salary ladder.
This is exactly my experience (jumping ship and changing titles). I didn't see much discussion in the article about "what do I need to do to get to the next level" as a point of discussion when asking for more money. This is an easier discussion for your manager in many cases, and in theory at least should come with an increase when it happens. For many larger companies, in the long run the key to increasing your salary is getting promoted a lot. The other factor to consider is how is the company doing. Are they doing well financially and expanding their business, starting new projects? Or are they cutting corners on expenses? If they are cutting corners on expenses, not replacing people who leave, etc, you really are probably better off looking somewhere else in many cases than trying to negotiate a higher salary.
Joel Spolsky, I believe, use to say this "Be a revenue producer, not a cost center." Get a developer job working on the product or services your company sells for revenue. Don't get a job working on internal systems designed to save on costs (looking at all the developers working for insurance companies and retailers developing back ends and internal applications designed to cut costs rather than increase sales and revenue).
EDIT: But yes, for most people and most companies, you'll need to jump ship to jump up a rung or two on the salary ladder.