Some folks here will recall the great microprocessor wars for the general purpose computer. Starting with the Z80, 8080, 6502, and 6809, moving to the 80286/386, 68000/68020, and SPARC/MIPS/PA-RISC/POWERPC.
Intel pretty much won that war by coming up from the bottom, powering 'toy' computers (IBM PC) running a 'toy' operating system 'MS-DOS' with 'toy' peripherals (640 x 480 graphics). They came up and ate workstations, and then they ate servers.
And here is the salient fact for me, they could do that because while the market for workstations might be 1 million/year, the market for PCs was 1 million a month (or more at its peak). So while a PC couldn't do what a workstation could early on, the PC market was generating a ton of cash which was going into improving the PC, much more cash and investment than was going into improving the Workstation. One by one the Workstation vendors dropped out of the market or replaced their offering with a "high end" PC.
ARM set up the same scenario today, although this time it was portable devices that were the 'toys' and clever and useful but not nearly as powerful as PCs were so hardly a threat, but for every million PCs sold there were 5-10 million phones sold. And all that money and all that investment goes into making the chips that power these phones better and better, and the PC king is sitting on there trying to make a more powerful PC when what people are buying are more powerful phones.
At IDF (in 2010 if memory serves) Intel noted that they were going to move into the embedded space more aggressively but it didn't actually follow through too well focusing in multi-chip solutions which didn't work well in space constrained phones. Meanwhile ARM was getting design win after design win with their SOC partners.
So last year Intel started going all out on making a lower power version of the x86 architecture which could compete with ARM and this years IDF they took aim at the SOC business. All in an effort to pull enough oxygen out of the ecosystem to slow ARM down. After all, if today you could choose between two chips, one ARM and one x86-64, with the same cost and power curve, you'd probably go with the x86-64 for the assurance that software support would be easier. But once software support isn't an issue it gets to be more of a horse race, and ARM has notably had much better licensing terms than Intel has after being nearly usurped by AMD the first time they tried it.
If ARM can get to 64 bits and I/O channel bandwidth faster than Intel can get to ARM's power envelope and cost, it will be a very interesting fight indeed.