Given the physical limitations, as well as the problems we have with code base security it might be time to aim for cheaper production of something in the region of 180nm instead.
Looking at how old much of the standard weaponry used today is (TOW 50 years with an actual physical gyroscope, Javelin still 25 years³), the demand from the military alone should cover the initial cost. Especially if you look at the ludicrous prices western countries payed for even dumb artillery shells.
¹ Texas Instruments DMD from a DLP projector from @AppliedScience https://youtu.be/9nb8mM3uEIc?t=428
² Explanation of MPU-6050 from @BreakingTaps https://youtu.be/9X4frIQo7x0?t=664
³ Teardown of both from @lelabodemichel5162 https://www.youtube.com/watch?v=s7-6hgX7-zQ
Sorry for late edits
If entering that marketplace requires competing with them, then I am not sure anyone that is not already in the market can ever win. The margins are too low and the startup costs are too high.
Government intervention seems to be the only possible solution, and that option hardly sounds viable when considering that cartel’s collective lobbying power.
I can afford to sell gazillions of chips at $0.08 per chip if I'm running a fab I didn't pay to build. I'm only (barely) paying for the inputs. When Stan, the last guy who understands how to run the widget verifier, or Elaine, the last lady to understands how to run the polishing machine retire, I'll have to close up shop.
Those $0.08 per chip devices have been absurdly subsidized in that a replacement infrastructure to make them would require that they cost $10 per device, and the ecosystem of things built on $0.08 chips isn't viable in a $10 per chip world.
In order to have a fab make $0.03 per unit devices, you first have to have the fab spend 10 years making $300 per unit devices, regardless of the underlying node size of those $300 per unit devices.
Likely you couldn't even go back and make a fab that makes large volumes of 60nm-90nm node sizes at all, for any amount of money, because the equipment to do this (new) hasn't been made in 2 decades and no company is willing to invest the money to make new crappy old equipment.
It's not a nefarious oligopoly as much as a synchronized "run the asset to failure" lifecycle of the infrastructure.
How much does it cost to make a 300 year old tree?
Aside from your main point, I found this an interesting thought exercise thinking about cost of air, sunlight, soil, water and then 300 years of security
If you're not going the obscurity path then you'd really want to scale it up - there's not much difference between security for one tree and security for 100 trees.
I believe your argument assumes that there is a fixed cost to produce even 180nm or 350nm ICs that hasnt changed since the first one was produced.
We still need 300 years for a 300 year old tree, but 25 year old technology might now be relatively easy to build if we start from scratch.
What was high tech then might be relatively easy to solve now. One example might be https://github.com/circuitvalley/USB_C_Industrial_Camera_FPG... being open source instead of a multi year, multi million dollar project.
Even if it is 10% the cost of making the each of the individual components involved in making a relatively simple 90nm chip, you're still looking at vast costs.
If you're talking about making 30 chips in a university fab, sure, I'll concede that it is "possible" but if you're talking about propping up an industry built on products that require a herd of standardized "$0.30" parts made on legacy 90nm fabs, that ship has sailed.
Update your BOM and recertify or raise your costs by an order of magnitude.
But realistically this is a matter of going back far enough, to lower the cost far enough? 10% are a good start but to stick to the topic, physical gyroscopes from decades ago are now replaced with MEMS ICs where the reduction in cost is magnitudes more then down to 10%. At a certain point the reduced cost makes it viable. The question is just has it been long enough?
While we wont get 90nm cheap enough, the question is what can we do on a hobby level (vs academia)? Because going from there (neglectable cost and technological requirements) to mass production will at some point be cheaper then the cost of setting up reproducible tooling for older high tech systems.
I am likely still off with 180nm, but there should be a level at which this makes economical sense. A level that gets cheaper to reach with technological progress / time.
My initial argument is that while you cant compete with ASML products in 2023, you will be able to economically compete with some of their older products once you go back far enough.
I think it's more like they're only profitable if the equipment is already paid for. And even then the margins may be low.