I think Apple needs the first generation to go out at it's expensive price in order to be able to produce 2nd and 3rd gen at pricing closer to the 1k mark. As with all Apple products, advice is to stay away from first gen unless you have no limit to your disposable income because second gen has significant improvements and is almost always cheaper. HomePod is another example of this, it cost way too much to produce and had a near zero profit margin with it's first gen. Second gen was re-engineered to be both better and much cheaper to produce, so now I see people actually buying it.