I would love to see a 3 way competition between Intel, AMD, and Apple for consumer chips.
They're not interested in competing on other people's terms in commoditized markets. They sell luxury goods.
Apple owns like half of the consumer market, everybody and their mother has Apple hardware, so not sure how you would call that "luxury goods".
One of the reasons for Apple's success is that it's managed to pull off mass-market luxury better than anyone else.
Arguably, luxury items doesn't have to be exclusive, just overpriced.
Apple are a high margin business. I highly doubt they want to harm their gross margin, but its possible. Apple however have not been that successful co-designing.... well, anything. They are highly opinionated that they are correct and this has typically lead to them blazing new trails, but has also lead to mis-steps. For bespoke systems, that would rely on building what the customer asks for. Apple's generally isn't great with working with outside suppliers, generally trying to bring the work inside. Finally this would require apple to tie their hands (in the same way microsoft has) with compatibility to provide the long term support that the vendors require.
Apple would never become the suppliers the cloud providers want. The only way they would be chosen is if the product is significantly better then what otherwise exists. I can easily see Apple leapfrogging incumbent server vendors for performance or such for a short term, but I expect the others will catch up very quickly. Cloud hardware is already well integrated by companies motivated to eek out every little bit of performance (see facebook and the OCP). Despite being significantly more different from an engineering perspective, I actually think manufacturing cars is more similar from a business perspective for Apple.
Nadella is good only because his predecessor was crap. ( Sorry Steve Ballmer ).
I dont think they are in the same league. Gelsinger will be a far better CEO as this company roadmap has shown. Engineers alone dont make great CEO, that was the word Andy Grove told Gelsinger. You need a product person, with vision, strategy, engineering and business senses. And somehow they are a very rare breed.