Intels problem is that it cannot sell FAB time because they are vertically integrated
This is true. Intel will fab chips for other people, but they've had very few customers because everyone knows that the priority customer at Intel fabs is Intel and if yields are lower than expected it won't be Intel chips that get delayed.
Intel builds a FAB and runs its next gen chips off of it for a few years, then they are stuck looking for something to do with the FAB when it is no longer current-gen
This is simply not true. Slashdot likes to think of Intel as a a CPU vendor, but that's actually quite a small part of their business. They make a lot of other kinds of chip and a great many of these don't require the latest and greatest fab technology. This has always been a big part of their advantage over AMD: they have products that will use the fab for 10+ years, so they can amortise the construction costs over that long a period.
TSMC's revenue is now approaching Intel's, and unlike Intel they can keep all their FABs busy making money, so the outlook for Intel is grim without a serious restructuring, which they are doing (see recent massive layoffs, and bullshit marketing about their new "cloud strategy")
This is the important part and is where the ARM ecosystem has an advantage over Intel. No single processor vendor has to compete head-to-head with Intel. As long as the total size of the ecosystem is large enough, the foundries can invest in process improvements.