  The origin of the soft excess seen in many AGN below ~1 keV is still an
unsolved problem. It is unlikely to represent a true continuum component as its
characteristic 'temperature' shows a remarkable constancy over a wide range of
AGN luminosity and black hole mass. This instead favours an association with
atomic processes, in particular with the increase in opacity between 0.7-2 keV
associated with partially ionized O and Fe. The opacity jump can give rise to a
soft excess either through reflection or transmission, and both scenarios can
fit the spectra equally well as long as there is strong velocity shear to smear
out the characteristic narrow atomic features. Here we use orthogonal
constraints from the energy-dependent variability. The rms spectra seen in
XMM-Newton AGN data often show a broad peak between 0.7-2 keV. We show that the
absorption model can explain the data well if the ionization state of the
smeared absorption responds to luminosity changes in the continuum.
