I'm not sure when the first (Colt?) AR-15s were put onto the civilian market (50's or 60's?), but I doubt that the American gun owners of the time all rushed out to replace their Garands/Springfields/Shotguns/Lever Actions or whatever it was that they had.
The AR was available to the civilian market about the same time it was available to the military. There are advertisements for it, too.
Of course, at the same time you could by a shiny new AR with that shiny new gun price tag attached, you could get a milsurp, decent condition, Garand, Springfield, or Mauser rifles by the barrel for a heck of a lot cheaper. And they were the proven rifles of the period. So, no, people didn't replace their rifles with the AR. Just like today, few are replacing the now proven and common ARs with SCARs, XCRs, etc. Undoubtedly, we will eventually move towards the newer generation rifles. I just don't think it's going to be anytime soon.
The AR is good but its not used by over 70 countries, and its nick name is not "the right arm of the free world". It also hasn't marched around the world like the AK has; also it seems like damn near every country in the world has made AK's at one time or another.
Is the FAL still used by over 70 countries?
Remember the AR is big really only in this country, no one else uses them.
I know they are our hat, but doesn't Canada count as someone else? What about the other countries on this list? In use by 15 NATO member countries doesn't count? (the numbers in brackets are source links for wikipedia, I'm not taking the time to edit that out)
http://en.wikipedia.org/wiki/M16_rifle#Production_and_users
* Afghanistan[33]
* Australia[34]
* Bangladesh (Used by Bangladesh military, Special Forces and Counter Terrorism Units)[35]
* Barbados[36]
* Belize[36]
* Bolivia[36]
* Brazil[36]
* Brunei[36]
* Cambodia[36]
* Cameroon[36]
* Canada: C7 variant is used by the Canadian Armed Forces.[37]
* Chile[36]
* Democratic Republic of the Congo[36]
* Costa Rica[38]
* Denmark[36]
* Dominican Republic[36]
* East Timor[39]
* Ecuador[36]
* El Salvador[36]
* Estonia[40]
* Fiji[36]
* Gabon[36]
* Ghana[36]
* Greece[36]
* Grenada[36]
* Guatemala[36]
* Haiti[36]
* Indonesia[36]
* Iraq: Iraqi army.[41]
* Israel[42]
* Jamaica[36]
* Jordan[36]
* Republic of Korea (Manufactured under license by Daewoo)[36]
* Lebanon[36]
* Lesotho[36]
* Lithuania (M16A2 used by National Defence Volunteer Forces)
* Malaysia[36]
* Mexico[36]
* Morocco[36]
* New Zealand[36]
* Nepal[43]
* Netherlands: C7 variant is used by the Royal Netherlands Army.[37]
* Nicaragua[36]
* Nigeria[36]
* Oman[36]
* Panama[36]
* Peru[36]
* Philippines (manufactured under license by Elisco Tool and Manufacturing)[36]
* Qatar[36]
* Senegal[44]
* Somalia[36]
* South Africa[36]
* Sri Lanka[36]
* Thailand[36]
* Tunisia[36]
* Turkey[36]
* Uganda[36]
* United Arab Emirates[36]
* United Kingdom The M16A1 and M16A2 were used by the UK Special Forces. But have been largely replaced by the C8.[45]
* United States[46]
* Uruguay[36]
* Vietnam[36]