Other than AMD who actually competes with Intel (honest question). I mean for servers there is 686 descendants (Intel/AMD) and then ... err ARM on servers ?
https://www.anandtech.com/show/15578/cloud-clash-amazon-grav...
"Cost Analysis - An x86 Massacre"
Intel beating TSMC in node size isn't going to happen in near term even in Intel's best case scenario, and even if that were to happen - fabs like TSMC will always have enough scale to compete. So Intel might as well buy from TSMC and take over its rival's production. Every chip Intel buys from TSMC is a chip taken from AMD and a spare chip Intel fabs could make.
Of course, AMD won't have zero capacity - even Intel doesn't want that - but I doubt AMD paid for all the time they'll ever need. For one thing this is a seller's market, if AMD had more chips people would buy. Also, AMD has a well-publicized chip shortage to the point they contracted with GlobalFoundries again (for the less important chips) about a month ago.