Art is political more than it is technical. People like Banksy’s art because it’s Banksy, not because he creates accurate images of policemen and girls with balloons.
But Banksy wasn't originally Banksy.
I would imagine that you'll see some new heavily-AI-using artists pop up and become name brands in the next decade. (One wildcard here could be if the super-wealthy art-speculation bubble ever pops.)
Flickr, etc, didn't stop new photographers from having exhibitions and being part of the regular "art world" so I expect the easy availability of slop-level generated images similarly won't change that some people will do it in a way that makes them in-demand and popular at the high end.
At the low-to-medium end there are already very few "working artists" because of a steady decline after the spread of recorded media.
Advertising is an area where working artists will be hit hard but is also a field where the "serious" art world generally doesn't consider it art in the first place.
Oh. What is the difference?
Musicians will keep playing live, artists will keep selling real paintings, sculptors will keep doing real sculptures etc.
The internet is going to suffer significantly for the reasons you point out. But the human aspect of art is such a huge component of creative endeavours, the final output is sometimes only a small part of it.
If it were just about “the next Banksy” it would be less of a big deal. Many actors, visual artists, technical artists, etc make their living doing stock image/video and commercials so they can afford rent while keeping their skills sharp enough to do the work they really believe in (which is often unpaid or underpaid). Stock media companies and ad agencies are going to start pumping out AI content as soon as it looks passable for their uses (Coca Cola just did this with their yearly Christmas ad). Suddenly the cinematographers who can only afford a camera if it helps pay the bills shooting commercials can’t anymore.
Entire pathways to getting into arts and entertainment are drying up, and by the time the mainstream understands that it may be too late, and movie studios will be going “we can’t find any new actors or crew people. Huh. I guess it’s time to replace our people with AI too, we have no choice!”