Easy mode is to encrypt the device key for each individual device, store it only with the manufacturer. Make it more difficult by requiring m-of-n agreement (pr

Easy mode is to encrypt the device key for each individual device, store it only with the manufacturer. Make it more difficult by requiring m-of-n agreement (probably via a parity block scheme) between HSMs to derive the key if you wish (with the key material being guarded on separate stores so that an insider can't simply hack into access), but that's not that difficult in comparison to what we're talking about. Even easier might be to have the device itself store an encrypted version of the data storage key, encrypted to a PKI private key that only the manufacturer controls (i.e. leave a GPG-encrypted file accessible in an unencrypted partition that unlocks the rest of the storage). Since we're assuming that skilled hackers will forcibly encrypt sensitive data anyways by jailbreaking if needed, it's not that much of an additional stretch to leave the key on the device itself, and FBI can still get warrants served on the 99.9% of accused criminals who can't be arsed to figure out that their iPhone can be unlocked. I'm not even close to a crypto expert either, someone with deep insight into the crypto literature (I hear NSA has a few of those...) could undoubtedly point to more applicable research that would be useful here.