“The government wants Apple to produce a software that will bypass the phone’s security encryption system. “
NOWHERE is ‘encription’ mentioned. Only a way to keep the phone from erasing after the allotted number of tries.
Correct, the FBI wants Apple to bypass the “brute force attack” protections (10 tries & the “timers”) so that the FBI can try and “brute-force” the password/key to the 256-bit AES encryption on the phone. If Johnny-Jihad used a long alpha-numeric password then the FBI is out of luck. If the perp used a 4 or 6 digit numeric only password they could potentially crack it fairly fast with govt. super-computer power.
https://www.apple.com/business/docs/iOS_Security_Guide.pdf
http://www.eetimes.com/document.asp?doc_id=1279619