Here’s how to solve Apple’s encryption dilemma:
Make encryption an app that numerous independent companies can provide. Each manufacturer can do encryption as it pleases. Each manufacturer can decide on a backdoor strategy. All Apple does is provide a single interface that all of the apps use. You could write your own app.
Would the government try to make backdoor rules applicable to all of the app manufacturers? Maybe, but I think black-market apps would appear. The government could never track all of them down. Once an app was installed on an iPhone, there would be nothing in it that would identify the producer of the app.
Apple thinks they should sell in China. China won’t go for it.