My idea was that rather than ban it outright and make it like most other internet traffic (decrypted on a server), they could mandate some kind of cacheing of the _encrypted_ data on the server. Then, once they'd lawfully executed a warrant to grab the suspects phone, they can decrypt at their leisure. Apps using per-message keys will probably be a no-no.
Myself - I live in the UK - I hope Apple, Google and Facebook all say a big "fuck you" and cut this country off from their services, but I have a feeling the 'compromise' is going to be something like the paragraph above.