It's amazing that the solution devised by a chip manufacturer to a problem is selling another chip.

This feels suspiciously good for Nivida, yes.

I wonder how this will impact other chip manufacturers? What about people running local models on older hardware? Does this imply vendor lockout is coming in the future or is this restricted to datacenter hardware?

Pedantically, Nvidia doesn't make the chips, TSMC does. Nvidia just designs and packages them.