I think it's pretty clear from the article what happened. They didn't have the capital (stemming from a lack of foresight and incentives) to invest in these fabs, relative to their competition.
If you look at this from an engineering standpoint, I think you'll miss the forest for the trees. From a business and strategy standpoint, this was classic case of disruption. Dominant player, Intel, was making tons of money on x86 and missed mobile opportunity. TSMC and Samsung seized on the opportunity to manufacture these chips when Intel wouldn't. As a result, they had more money to build/invest in research to build better fabs, which could be funded by the many customers buying mobile chips. Intel, being the only customer of their fabs, would only have money to improve their fabs if they sold more x86 chips (which were stagnating). By this time, it was too late.
If you look at this from an engineering standpoint, I think you'll miss the forest for the trees. From a business and strategy standpoint, this was classic case of disruption. Dominant player, Intel, was making tons of money on x86 and missed mobile opportunity. TSMC and Samsung seized on the opportunity to manufacture these chips when Intel wouldn't. As a result, they had more money to build/invest in research to build better fabs, which could be funded by the many customers buying mobile chips. Intel, being the only customer of their fabs, would only have money to improve their fabs if they sold more x86 chips (which were stagnating). By this time, it was too late.