Once you invite the vampire into the house should you really be surprised that you find it sucking your blood? The answer is that like most large companies they decided technologist leadership no longer mattered. It’s a pattern that repeats again and again and that is because the people who need to learn the lesson most are counter-incentivized to do so.
Several conversations on this topic have brought up that pay rates at Intel are now less than the median of the industry. This would be fallout from actions by the MBAs in charge, but I don't think it's just an MBA issue. Something is clearly rotten in middle management in Intel. Either the people investigating the problems with their process weren't given the freedom to experiment to narrow down the scope of the problem, or they lost all their competent process engineers and are left with insufficient clue to fix the problem. If Intel has to rebuild their process group from scratch, they could be in for additional years of pain as new people come up to speed. Given that the United States is no longer a leader in bleeding edge process technology, this could take far longer than expected. How long will it take Intel to poach enough talent from TSMC to make a difference? And will they be able to integrate into Intel's culture?
The Israel group saved their behind in the days of the Pentium M. It seems like skunk works projects have been crucial to Intel, but the last decade has been a lot of tick tock strategy and not a lot of hard engineering...
I don't have any insider info, but to my eyes a lot of this change would be risk aversion caused by the Itanium disaster.