What this tells me is that at some point, just like desktop OS, encryption will be wrested away from the manufacturer and be a user-initiated and controlled tool. An open-source adaptation of luks for phones or something similar would remove the ability for the Feds to force phone manufacturers into this situation.
What the hell was the thought process behind this in the first place?
"We need to bring freedom the swing set and be greeted as liberators by the 4th grade recess! THERE ARE WMD's IN PANTS! INVADE!"
I mean, if you're looking to grow terrorists, sure treat a middle school like Baghdad. There'll be IED's made out of markers and play-doh going off and tribal wars over pokemons, but you sure as shit won't be protecting anything.