Otellini's leaving because he's a wise man. Tough economic times, even tougher semiconductor market, competition becoming thornier than ever, he knows the semiconductor industry has some major contraction ahead. He doesn't want his legacy tarnished by something he doesn't have control over.
Intel already have the capabilities in designing their chips for FPGA usage which diversifies their functions in a chip. I had rumours on a Cedarview Development Board with FPGA capabilities. Also, not to mention the embedded automotive market that they are so dearly focusing on, especially the IVI projects they have been doing for a few companies for the past few years. However, as for mobile phone and tablet market, they might not have a strong foothold with Qualcomm, Samsung and Nvidia app processors flooding the market.
Samsung is a TOTALLY different case. They don't compete with Apple by making ARM SoCs, they compete with Apple by selling smartphones.
The article is merely suggesting that Intel make ARM SoCs for Apple, while selling x86 SoCs to Apple's competitors. No one is suggesting Intel should start selling smartphones.
Intel is used to making custom chips for its custom process. I think in the short term Intel can have more success in making ASICs (making chips for other people, using its design Library) rather than Foundry (let fab less design using there Design kit) .
It's a great idea but Intel is its own industry sector---they do everything in-house, from basic architectural and physical design, through their own EDA/chip design tools that are tuned to their fab process, and of course their own fabs. It will be a challenge to integrate some pieces from third-party workflow--it probably isn't as simple as reading a VHDL from ARM and synthesizing a foundry output file.
While the obervation about shrinking PC market is valid, I see two problems with the proposed shift. First, Intel has never played in a highly competitive market with razor thin margins, which is basically what the cell phone and tablet market is. Yes, they have had to contend with competition from players like AMD, but they have always released innovative products that had good margins (not to mention high volume, which was also helpful).
Second, they have consistently had about the industry's worst track record on power efficiency--it just wasn't as high a priority in the desktop segment. Combine this with the fact that they have never done well in the embedded market, either. I'm not sure battery operated phones and tablets are an area where they are going to leverage much expertise. That may be where the volumes are headed, but whether they could succeed technically or financially in that arena is an open question.