In the end, Intel did cannibalize themselves. It wasn’t too long after the Itanium launch that Intel was publicly presenting a roadmap that had Xeons as the appealing mass-market server product.
Yeah they actually survived quite well. Who knows how much they put into Itanium but in the end they did pull the plug and Xeons dominated the market for years.
They even had a chance with mobile chips using ATOM but ARM was too compelling and I think Apple was sick of the Intel dependency so when there was an opportunity in the mobile space to not be so deeply tied to Intel they took it.
I think the difference was that replacing Itaniums with Xeons on the roadmap didn't seriously hurt margins (probably helped!)
The problem with mobile was that it fundamentally required low-margin products, and Intel never (or way too late) realized that was a kind of business they should want to be in.
