The first country to kill off LLMs with draconian interpretations of copyright law will simply be handing the industry to other countries on a golden platter. For this reason, I don’t see the U.S. ruling in any sort of way that would damage the AI industry too much. There is simply too much money involved.
Given how we train models (content and math), AIs is not practical to ban/legislate away. While the public applications of AI are for content generation and NLP, as @Rinox alluded to, the military applications are where we are going to see the most focus from the government. As an example, the Lantirn targeting pod uses SVMs to profile aircraft from afar, and it took enormous engineering to get it accurate. Comparable object detection functionality can be obtained with NNs and off-the-shelf GPUs. Countries like China already have “differing philosophies” when it comes to intellectual property rights, so we can remove the largest manufacturing market from the potential list of those who would blanket ban AI. Ditto on any possibility of their military forgoing AI either.
The real problem here is copyright law, which has extended protections far and above the length of time that is reasonable. Had we terms of say 35 years, we could simply train on older material.