The existing ARM fabrication market is very balkanized. Presumably if Intel had dived in with both feet, they would have been able to dominate it using their incredible aptitude for iterating process technology.
There is certainly that third path though, where Intel embraced fabrication, then regretted it.
I'm not sure if Intel's process lead is what it once was. For the last year or so Samsung have been shipping phones that use their own 14nm FinFET process, very similar on paper to Intel's best. It's entirely possible that Samsung will actually beat Intel to 10nm.
A point that's been made is that Samsung's 14nm process isn't really equivalent to Intel's- many gate feature on Samsung's 14nm process are much larger than 14nm.
Still, just the fact that anyone is in a race with Intel at all would have been unthinkable 10 years ago.
There is certainly that third path though, where Intel embraced fabrication, then regretted it.