They aren't even trying to do the SoC thing, for marketing reasons the Atoms won't do ECC (ARM can) and for whatever reason they won't accept more than 4 GB of memory, which is the one place they have a fantastic lead over ARM (besides being Intel compatible :-), which has just decided to follow Intel's history in doing a PAE diversion before maybe someday doing a real 64 bit version.
I used to work for AMD, and I can sort of see the decision making that causes (allows?) this to happen. There were a lot of folks who were opposed to AMD entering the mobile phone, tablet and even netbook markets because margins in those segments are way lower than for the regular x86 chips.
Then, there are all the technical challenges in reworking fabs, design tools and microprocessor designs from being focused on high-performance towards low-power chips.
I'm not even sure Intel or AMD can produce chips that compete with ARM simply because of their size and the way the engineering organizations are set up. Each design involves hundreds of engineers and costs hundreds of millions of dollars, and I wonder if this style of engineering will be effective in competing against ARM, who seem to have relatively leaner, meaner and more agile teams.
Finally, even if Intel built a decent low-power chip, there's no guarantee customers will be queuing up to buy it. See what to happened to Itanium for instance.
TLDR: This is not as easy it looks for Intel because of three reasons: (1) lower margins (2) organizational intertia and (3) no guarantee of customers.
